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^study  and  review  of  the  problem  of  passenger 
transportation  in  Philadelphia  by  a  imified  system 
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irpartinent  of  ffiity  iSranatt 


A  STUDY  AND  REVIEXA/ 


OF    THE 


PROBLEM    OF    PASSENGER 
TRANSPORTATION    IN     PHILADELPHIA 


BY     A 


UNIFIED    SYSTEM    OF    LINES 


AN     ANALYSIS    OF    THE    PLANS    PROPOSED    FOR    ITS    SOLUTION 

WITH 
SUGGESTED     METHODS    FOR     THEIR    IMPROVEMENT 


BY 


WILLIAM    S.    TWINING 

DIRECTOR 


SUBMITTED    TO    THE    SELECT    AND    COMMON    COUNCILS 

OF    PHILADELPHIA 

MARCH    29,    1916 


BUREAU  OF  GOVERNMEffTAl  RESEARCH 

LIBRARY 

AA  LIBRARY  BUILD»NG 


^ 


w" 


ipparlmrnt  of  (Eity  Srauatt 


)  A  STUDY  AND  REVIEW 


OF     THE 


PROBLEM    OF    PASSENGER 
TRANSPORTATION     IN     PHILADELPHIA 


BY     A 


UNIFIED    SYSTEM     OF    LINES 


AN     ANALYSIS    OF    THE     PLANS    PROPOSED    FOR    ITS     SOLUTION 

WITH 
SUGGESTED     METHODS    FOR     THEIR    IMPROVEMENT 

BY 

WILLIAM    S.    TWINING 

DIRECTOR 


SUBMITTED    TO    THE    SELECT    AND    COMMON    COUNCILS 

OF    PHILADELPHIA 

MARCH    29,    1916 


BUREmJ  OF  GOVERNMENTAL  RESEARCH 

LIBRARY 

44  LIBRARY  BUILDING 


CONTENTS 


Page 

etter  of  Transmittal   3-6 

eneral  Discussion  of   the  Transportation  Prob- 
lem       7-15 

Elements  of  the  Problem  7 

The  Service  Element   7 

The  Fare  Element 8 

The  Fire-Cent  Fare  Policy 9 

Independent  Operator  of  City's  Lines 11 

Burden  not  Realized  Now   13 

Legal  Questions  not  Discussed  13 

Data  Forming  Basis  of  This  ReiJort 13 

(Jeneral  Principles    13 

The    Financial    Difficulties    of    the    Problem    of 

City-owned  Lines    13 

Why  Does  the  City  Engage  in  This  Experiment?  14 

Why  Called  an  Experiment?   15 

Main   Issues    15 

Study  of  the  Rapid  Transit  Problem  in  Phila- 
delphia with  Suggestions  for  its  Proper  De- 
velopment  (Summary  of  Report)    17-30 

Suggested  Improvements  in  the  Program 19 

Issues    20 

History  and  Analysis  of  the  Plans  for  Rapid 
Transit    Development    in    Philadelphia,    1913- 

1916   31-33 

Outline   of  the   Case    21 

Former  Taylor  Plans  Analyzed   23 

Taylor  Plans — Comparison  of  Previous  Recom- 
mendations      23 

Taylor  Plans — ^Comparative  Merits  of  the  For- 
mer Plans 29 

The  Taylor  Plan— Its  Ideals 30 

The  Taylor  Plan— General  Defects 30 

The    Taylor    Plan — Suggestions    for    Attaining 

the  Ideal    31 

Loan   Bill   and   Ordinances    Under   Which    Con- 
struction was  Authorized    31 

Present  Situation  Complicated  by  Past  Mis- 
takes    33 

The  City's  Financial  Standing — Improvement 
Which  Will  Result  if  the   Burden   be   Placed 

Upon  the  Car  Rider  33 

Financing  of  the  Project  33 

'he   Present   Plans    for   Rapid   Transit    Develop- 
ment    35-43 

Definition  of  the  Taylor  Plans    »  35 

Construction  Program  of  Taylor  Plan 37 

Objections  to  the  Construction  Program  of  the 

Taylor  Plan    37 


Page 
The    Proposed    Operating    Lease    of    City-built 

Lines 38 

Transfers  Between  Lines  41 

General  Discussion  of  Rapid  Transit  Lines 45-57 

Advantages  of  Rapid  Transit  Lines 45 

Results  Due  to  Location  and  Routing 45 

The  Broad  Street  Line  and  Loop 4fl 

Objections  to  Loop   46 

Through-Routing 48 

The  Ideal  Local  Transi>orta.tion  System  for  n 
Population    of    3,000,000   Within    a    Circle    of 

13-mile  Radius 48 

Ideal    System    (A   Unified   Plan    of    Operation) 

Applied  to  Philadelphia   50 

The  Middle  Zone  of  the  City  and  Its  Transpor- 
tation Problems    51 

The  Suburban  Zone  Service  51 

Effect   of  Rapid  Transit  Lines   in  Distribution 

of   Population    52 

Discussion  of  Principle  of  District  Assessment 

for  Local  Benefits   53 

How  are  the  Bills  to  be  Paid  for  Constructing 

and  Operating  the  Rapid  Transit  System?...         55 
Trunk   and   Terminal   Lines    to   be    Financed 

by  City  Bonds   55 

Branch  Lines  and  Extensions  Proposed  4,0  be 
Financed    on    Principle    of    Assessment    of 

Local  Benefits    55 

Alternate  Method  of  Financing  Branches  and 
Extensions  of  the  Trunk  Portion  of  the  Sys- 
tem           56 

Suggested  Improvements  in  the  Plans  for  Rapid 

Transit   Development    59-69 

Suggested    Improvements    in    the    Construction 

Program  of  the  Taylor  Plan  59 

Suggested  Construction  of  Comprehensive  Sys- 
tem in  Successive  Steps   60 

Construction  Step  No.  1   60 

Construction  Step  No.  3  60 

Importance     of     Erie     Avenue     as     Temporary 

Northern  Terminal  of  Broad  Street  Lines...         60 

Walnut  Street  Line   61 

Temporary  Stub-End  Terminals    61 

Train   Capacity    61 

Reasons  for  Constructing  Four  Tracks  on  Broad 

Street 63 

Construction   of  Camden  Tube    63 

Successive  Steps  and  Extensions  in  the  Future.         63 
Time  of  Construction  and  Operation 63 


Page 

Suggested  Improvements  in  the  Plans  for  Rapid 
Transit  Development — Continued. 

Comparison  of  Cost  of  Construction — Amount 
of  Loan  Suggested   63 

Why  is  Construction  in  Progressive  Steps  Ad- 
vised?    64 

EfEect  of  Gradual  Construction  by  Steps  on  the 

Lessee  of  City's  System  65 

Reservation     of     Space    in     Broad     Street     for 

Through  Lines  of  the  Pennsylvania  Railroad.         6B 

Change  of  City  Hall  Station   66 

Change  of  Existing  Contract  for  City  Hall  Sta- 
tion           68 

Financial  Operating   Statistics    71-74 

Estimated  Financial  Results  of  Operation  Un- 
der Various  Plans  of  Construction  and  Lease.         71 
Financial  Consequences  of  Operating  Deficits....   75-78 

Probable  EfEect  of  the  Transit  Program  of  City 

Taxes 75 

How  are  These  Deficits  to  be  Met? 75 

Who  Should  Carry  the  Burden  of  Deficits  Re- 
sulting from  a  Unified  System?  76 

What  Adjustment  of  Carfare  Would  be  Neces- 
sary to  Make  the  Unified  System  Self-sup- 
porting?           78 

Appendix  A. 

Building  of  Rapid  Transit  Lines  in  New  York 

City  by  Assessment  Upon  Property  Benefited.   87-90 

Appendix  B. 

Paying  the  Bills  for  City  Planning 91-93 

Appendix  C. 

Memorandum  as  to  Legal  Status  of  Assessment 
for  Rapid  Transit  Development  in  Pennsyl- 
vania and  City  Solicitor's  Opinion   95 

No.  Statements.  Page 

1  Taylor  Plans  Analyzed — Comparison  of  Re- 
sults Based  on  Recommendations — Reports 
of  Transit  Commissioner  and  Department 
of  City  Transit — Operation  by  Philadelphia 
Rapid  Transit  Company  Assumed    23-25 

3     Comparison  of  Fundamental  Features  of  the 

Different  Taylor  Plans   26,  27 

3  Comparison    of   the   Financial   Feasibility   of 

the    Rapid    Transit    Systems    Discussed    in 

This  Report    28 

4  Comparison  of  Taylor  Plans    42, 43 

5  Comparison  of  Financial  Results  to  the  City 

from  Operation  Under  Different  Plans. 
(Operation  by  Philadelphia  Rapid  Transit 
Company)  —  (Camden  Tube  Not  Included).         79 


6  Comparison  of  Financial  Results  to  the  City 

from  Operation  Under  Different  Plans. 
(Operation  by  Philadelphia  Rapid  Transit 
Company)  —  (Camden  Tube  Included) 

7  Comparison  of  Outlay — For  3-Year  Period .  . . 

8  Comparison   of   Total  Investment    (City  and 

Company)  and  1913  Population  Served  by 
Steps  1  and  2  of  Modified  Program  as  Out- 
lined in  this  Report  with  Taylor  Plan 

9  Average  Fare  per  Revenue  Journey  Received 

by  the  Philadelphia  Rapid  Transit  Com- 
pany from  1900  to  1915   

10  Estimated  Average  Fare  Required  per  Rev- 
enue Journey  During  1915  if  Lines  Assumed 
for  Plan  No.  16  of  1915  Annual  Report  of 
Department  had  been  in  Operation 

1 1 .  Estimated  Average  Fare  per  Revenue  Jour- 
ney Necessary  to  Support  Entire  Taylor 
System  if  in  Operation  in  1915 , 

12     Estimated  Average  Fare  per  Revenue  Journey       J 
Necessary   to    Support   Broad    Street   Line,      .! 
Delivery   Loop,   Frankford   Line   to   Rhawn 
Street  and  Darby  Line    

Maps.  P^ 

Frontispiece : 

Subway  and  Elevated  Lines  for  Suggested 
Unified  System  and  Plan  of  Through-Rout- 
ing for  Comprehensive  System  (Operation 
by  Philadelphia  Rapid  Transit  Com- 
pany)     Facing 

No. 

1  Subway    and    Elevated    Lines    Suggested    for 

Independent  (Competitive)  System  and  Plan 
of  Through-Routing  for  Comprehensive  Sys- 
tem    Facing 

2  Plan  for  Rapid  Transit  Development  in  the 

Business  District  Facing 

3  Ideal   Transportation   System   as  Existing  in 

West  Philadelphia  Facing 

4  The  Increased  Area  Brought  Within  the  30- 

Minute  Time  Zone  from  the  Business  Dis- 
trict by  Steps  1  and  2 Facing 

5  Trunk  and  Terminal  Sections  of  Rapid  Tran- 

sit Lines  to  be  Financed  on  City  Bonds  and 
Extensions  to  be  Financed  by  Local  As- 
sessment  of   Benefits Following 

6  Revised     Location — Broad     Street     Subway — 

City  Hall  Station  Facing 

7  Broad  Street  Subway — Showing  Distribution 

of  Race  Street,  City  Hall  and  Chestnut 
Street  Stations   Following 


DiAQEAMS.                                  Page 
Diagram  Illustrating  Function  of  Rapid  Tran- 
sit   Lines    in    a    Unified    System    and    the 
Principle   of   Through-Eouting    48 

Diagram  Showing  Application  of  Principles 
Applied  to  Existing  Conditions  in  West 
Philadelphia    49 

Percentage  Distribution  of  North  Broad 
Street  Passengers  (Inbound)  at  Delivery- 
Loop  Stations,  Taylor  Plan   Facing         46 

An  Ideal  Transportation  System   Facing         50 

Application  of  Ideal  Rapid  Transit  System  to 

Conditions  in  Philadelphia Facing        50 

Comparison  of  Daily  Passengers  at  Various 
Stations    on    New    York    and    Philadelphia 


No.  Page 

High-speed     Systems      (One-Way     Traffic^ 
Boarding)     Facing         60 


5     Modified  Rapid  Transit  System  with  Through- 
Eouting   Facing 


63 


6  Actual    Fare    Requirements    of    Unified    Sys- 

tem Assumed  Under  Plan  No.  16,  1915  An- 
nual Report  of  Department  of  City  Tran- 
sit ;  also  showing  a  Suggested  Program  of 
Fare  Adjustment,  1920  to  1950 Facing         78 

7  Results  to  City   (Estimated)    from  Operation 

of  Unified  System  Under  Different  Plans  on 
5-Cent  Fare  Basis,  Camden  Tube  Not  In- 
cluded     Following         09 


fd/.  CHASE 


SUBWAY  AND  ELEVATED  LINES 

(Steps  I  and  2  shown  in  Red) 

for 

SUGGESTED  UNIFIED  SYSTEM 

and  Plan  of 

THROUGH-ROUTING  FOR  COMPREHENSIVE  SYSTEM 

(Operation  by  Philadelphia  Rapid  Transit  Company) 


tCENO 


ELtVATEO 


—  ^  ^  suewAT 

EXISTING  TRACK 

NEWTRACK 

EXISTING  TBaCH 
NE'AT  TnACK 


FRONTISPIECE 


To  THE  Select  and  Common  Councils  of  the  City  of  Philadelphia  : 

Gentlemen  : — Iiitroductory  to  this,  uiy  first  report  on  the  Rapid  Transit  Problem 
iu  Phihidelphia,  it  may  be  well  to  state  that  it  is  submitted  in  compliance  with  the 
Act  creating  the  Department,  which  states : 

"The  Director  shall,  from  time  to  time,  make  such  recommendations  to  the 
councils  of  said  cities,  as  to  him  shall  seem  proper,  for  the  improvement  and  de- 
velopment of  the  facilities  for  transportation  of  persons  and  j^roperty  within  said 
cities." 

When  I  accepted  this  office  under  the  City  government,  I  had  definite  ideals  and 
convictions  regarding  the  principal  features  of  the  transportation  problem  of  Phila- 
delphia, l)ut  I  had  no  intention  then  of  issuing  a  report  of  this  character. 

Further  study  of  the  situation,  however,  has  shown  me  that  a  report  is  needed, 
primarily  in  order  to  explain  my  motive  and  purpose  in  suggesting  some  changes  in 
the  details  and  the  financing  of  the  plan  for  transit  development  now  before  the  public, 
popularly  known  as  the  "Taylor  Plan;"  also  to  make  clear  some  of  the  technical  and 
financial  features  of  that  plan,  and  to  advise  City  Councils  what  methods  of  executing 
it  I  consider  are  rational  and  business-like,  and  will  tend  toward  the  final  attainment 
of  the  ideal  which  is  so  much  desired. 

The  transit  problem  in  Philadelphia  is  a  real  problem,  and  the  solution  of  it  is  a 
vital  issue. 

The  problem  may  be  expressed  as  a  question,  "What  can  be  consistently  done,  and 
what  shall  Ite  done,  to  improve  the  transportation  facilities  of  our  City  to  provide  for 
future  growth,  and  how,  when  and  where  shall  such  facilities  be  provided?" 

The  original  "Taylor  Plan"  as  published  in  1913  was  the  result  of  a  year  and  a 
half  of  study  and  investigation  of  Philadelphia  conditions  and  was  supposed  at  that 
time  to  be  a  complete  answer  to  the  problem. 

No  competent  authority  will  assert  that  any  general  plan  of  such  scope  and  char- 
acter is  absolutely  final  and  perfect;  all  such  plans  must  be  altered  and  amended  to 
suit  new  ideas,  new  conditions  and  new  data.  As  evidence  that  this  is  true  as  applied 
to  the  "Taylor  Plan,"  I  quote  the  first  paragraph  of  the  1914  Report  of  this  Depart- 
ment: 

"In  order  to  outline  the  present  status  of  the  project  for  which  this 
Department  was  established,  I  call  to  your  attention  the  recommenda- 
tions of  my  previous  report,  as  partially  modified  and  enlarged  by  addi- 
tional recommendations  which  are  referred  to  at  length  herein." 


Two  revisions  of  the  original  plan  have  been  issued  by  Mr.  Taylor,  the  former 
Director  of  this  Department,  and  the  main  features  of  the  final  plan  of  1915  are  ex- 
cellent in  their  conception.  Different  oiiicials  draw  different  conclusions  and  form 
different  opinions  from  the  same  data,  and  in  this  report  I  submit  suggestions  which, 
in  my  judgment,  will  amend  and  improve  the  plans  already  published. 

This  report  is  supplemental  to  those  that  have  preceded,  and  may  be  considered  as 
a  fourth  edition  of  the  "Taylor  Plan,"  differing  in  no  essential  features — only  in  de- 
tails and  policy — from  the  latest  plan  as  issued  iu  the  1915  Annual  Report  of  this 
Department.  The  ideas  presented  herein  are  set  forth  with  the  sincere  desire  to 
secure  to  Philadelphia  the  best  obtainable  transportation  service. 

In  view  of  my  relation  with  this  Department  for  the  last  three  and  one-half  years, 
as  a  member  of  the  staff  of  Ford,  Bacon  &  Davis,  Consulting  Engineers  to  the  De- 
partment, it  seems  unnecessary  to  state  that  I  do  not  entertain  the  slightest  oppo- 
sition to  the  general  plans  already  proposed. 

The  transportation  problem  of  Philadelphia  is  a  business  and  municipal  one,  and 
the  solutions  presented  in  this  and  former  reports  are  the  personal  opinions  of  in- 
dividuals who  are  honestly  striving  to  serve  the  City  to  the  best  of  their  ability. 

I  wish  to  state  clearly  and  emphatically  that  I  have  no  desire  or  intention  to 
recommend  any  curtailment  of  the  comprehensive  program  of  rapid  transit  develop- 
ment outlined  in  the  former  reports  of  this  Department.  I  realize  fully  the  value  and 
great  amount  of  work  done  by  Mr.  Taylor,  my  predecessor  in  this  office,  in  procur- 
ing the  enabling  legislation  and  thereby  starting  this  important  enterprise.  I  appreci- 
ate the  great  difficulties  with  which  he  was  confronted,  and  having  had  a  small  part 
in  planning  this  work,  have  tried  in  this  report  to  so  continue  his  plans  that  the  ideal 
may  be  eventually  realized. 

I  am  heartily  in  favor  of  the  construction  of  each  and  every  one  of  the  radial  lines 
or  routes  which  have  been  recommended,  if,  as,  and  when  authorized  by  the  citizens. 

Acting  as  the  legal  consulting  engineer  for  the  City  Councils  in  transit  matters, 
it  is  my  duty  to  assist  them  to  obtain  for  the  public  such  benefits  as  are  practically 
possible — not  to  obstruct  or  delay  any  plan  or  its  execution. 

This  Department  certainly  will  not  oppose  the  construction  of  lines  anywhere  and 
everywhere  so  long  as  the  citizens  realize  and  are  willing  to  assume  the  resulting  bur- 
dens. They  alone  must  determine  the  extent  to  which  they  wish  to  furnish  funds  for 
building  such  lines. 

The  Director  of  this  Department  cannot  nullify  or  modify  the  acts  of  the  citizens 
or  their  representatives  in  City  Councils. 

Professional  ethics  demand  that  a  report  of  this  kind  shall  present  the  truth,  and 
the  whole  truth,  in  regard  to  the  subjects  discussed.  This  report  aims  to  fulfill  that  de- 
mand in  regard  to  the  transportation  problem  of  Philadelphia  as  the  Director  sees  it. 

This  report  is  not  to  be  considered  in  any  way  as  either  a  personal  or  political 
attack,  or  criticism  of  plans  originated  under  the  former  administration.  It  is  made 
only  to  serve  the  best  interests  of  the  City. 

Although  this  report  assumes  that  the  present  system  and  the  new  City-built 
lines  will  be  operated  as  a  unified  system,  it  must  not  be  overlooked  in  considering  the 


problem  that  the  City  has  no  legal  power  to  force  a  lease  of  its  high-speed  system 
upon  the  present  Company.  The  threat  of  a  ruinous  competition  is  the  principal 
weapon  which  the  City  may  use  in  order  to  compel  the  execution  of  a  lease  of  the  new 
lines  by  the  present  Company. 

An  engineer's  work  is  principally  constructive.  His  aim  should  not  be  the  de- 
struction of  either  physical  or  financial  property,  but  its  conservation. 

This  is  an  engineer's  report  on  a  transportation  problem,  an  experiment  unique  in 
many  features,  and  is  intended  to  give  such  facts,  advice  and  technical  data  as  the 
public  may  need  in  order  to  understand  the  fundamental  difficulties  inherent  in  an 
enterprise  which  even  its  most  enthusiastic  advocates  admit  must  burden  for  years  to 
come  either  the  taxpayer  or  the  car  rider,  as  may  later  be  determined. 

It  aims  to  point  out  some  fallacies  popularly  believed,  to  make  some  suggestions 
that  should  be  helpful,  to  bring  out  such  facts  as  have  not  heretofore  been  generally 
known— or,  if  known,  not  appreciated  as  to  their  importance— and  to  serve  the  people 
and  the  best  interests  of  the  entire  City  of  Philadelphia.  In  its  preparation  I  have 
given  much  study  as  to  how  the  burdens  and  benefits  which  the  lines  will  produce 
.should  be  distributed,  and  suggestions  are  herein  presented. 

While  in  this  report  a  program  of  construction  is  advised  which  calls  for  the 
authorization  at  this  time  of  only  $35,000,000,  I  feel  that  the  determination  of  the 
amount  that  shall  be  authorized  is  a  matter  that  rests  entirely  with  the  citizens  and 
their  representatives  in  City  Councils. 

I  would  suggest,  however,  that  this  item  be  placed  in  the  loan  bill  for  the  purpose 
of  rapid  transit  development  with  a  broad  authorization  following  the  general  word- 
ing of  the  Act,  i.  e.,  "for  the  construction  and  improvement  of  subways,  tunnels,  rail- 
ways, elevated  railways  and  other  transit  facilities,"  or  if  this  be  considered  inadvis- 
able or  inexpedient,  the  item  may  be  worded  as  follows : 

Item — Towards  the  construction  of  subways,  tunnels,  railways,  elevated  railways 
and  other  transit  facilities  along  any  or  all  of  the  following  routes : 
Frankford  Line, 
Broad  Street  Line, 
Parkway — Roxborough  Line, 
Darby  Line, 
Together  with  any  or  all  branches  and  extensions  of  same. 

If  legally  possible,  I  advise  that  the  lines  be  divided  into  sections,  as  has  been  done 
in  this  report,  and  the  people  permitted  to  vote  on  each  section  of  the  plans  indepen- 
dently, the  estimated  cost  of  each  section  being  apportioned  in  the  loan.  In  this 
way  a  definite  expression  can  be  obtained  from  the  citizens  as  to  their  attitude  toward 
the  transit  problem  as  a  whole  and  the  extent  of  their  interest  in  tlie  individual  lines. 

I  realize  that  the  public  in  general  does  not  possess  the  proper  technical  knowl- 
edge and  training  to  enable  it  to  decide  intelligently  as  to  the  merits  of  the  suggested 
alteratiiMis  in  routing,  station  locations,  etc.    Some  of  these  changes  involve  problems 


of  railroad  oi^eration  as  well  as  construction.     In  addition,  the  public  is  often  swayed 
as  to  its  judgment  on  such  matters  by  sentiment. 

The  decision  as  to  all  such  matters  affecting  this  problem  should  not  be  influenced 
by  personal,  political  or  sentimental  consideration,  and  as  all  plans  must  by  law  be 
submitted  to  and  finally  approved  by  the  Public  Service  Commission  of  the  State,  I  sug- 
gest that,  in  order  to  avoid  delay,  the  Commission  be  requested  to  review  this  situation 
as  far  as  their  powers  permit  and  render  a  decision  as  to  these  details  as  soon  as  pos- 
sible. 

I  take  this  opportunity  to  thank  my  assistants  in  the  Department  for  the  efficient 
aid  they  have  rendered  in  the  preparation  of  this  report  and  their  earnest  endeavors 
to  aid  in  the  solution  of  this  public  problem. 

Respectfully  submitted, 


March  L'!»,  11»1G.  Director. 


GENERAL    DISCUSSION    OF   THE    TRANSPORTATION    PROBLEM 


Elements  of  the  Problem. 

The  entire  transportation  problem  of  the  city  contains  but  two  fundamental  elements — 
service  and  car  fare — what  kind  of  service  do  the  people  want,  and  how  much  are  they  willing 
to  pay  for  it  1 

It  is  a  purely  economic  problem,  the  service  demanded  by  the  public  constituting  the 
cause  and  the  car  fare  the  effect. 

If  looked  at  from  the  other  direction,  and  the  car  fare  be  fixed,  the  resulting  service  will 
be  automatically  determined. 

Rapid  transit  facilities  are  simply  one  element  of  service  in  the  general  transportation  prob- 
lem of  the  City.  As  the  quality  and  amount  of  service  rendered  by  a  system  must  be  a  large 
factor  in  determining  the  car  fare,  it  may  be  said  that  the  control  and  solution  of  the  entire 
problem  centers  in  the  fare. 

The  Service  Element. 

The  prominent  element  of  this  problem  as  the  public  ordinarily  regards  it  is  the  service  to 
be  rendered.  They  regard  the  fare  as  fixed.  But  that  it  is  not  fixed  and  that  it  varies  with  the 
cost  of  the  service  rendered  will  be  shown  in  this  report. 

The  term  service  has  been  defined  as  an  agency  for  the  accomplishment  of  some  constantly 
needed  work  or  the  supply  of  some  recurrent  demand.  Transportation  service  in  the  mind  of 
the  public  is  graded  according  to  the  degree  in  which  it  possesses  each  of  the  elements  of 
frequency,  regularity,  reliability,  accessibility,  speed  and  comfort. 

In  considering  the  service  requirements  of  a  city  the  population  must  be  divided,  not  into 
wards  or  political  divisions,  but  into  zones  of  density  and  distance  from  the  center  of  the  city — 
into  economic  divisions. 

The  term  "Unified  Service"  as  used  in  this  report  means  a  joint  operation  of  surface  and 
rapid  transit  lines  in  such  a  manner  that  each  shall  as  nearly  as  possible  render  the  service  in 
which  it  is  most  efficient  and  to  which  it  is  best  adapted.  The  terms  of  such  operation  must  be 
fixed  by  agreement  or  law  when  ownership  of  the  lines  is  not  joint. 

The  cost  of  transportation  service  is  the  sum  of  the  costs  of  supplying  each  of  these  ele- 
ments continuously  to  such  a  degree  as  will  meet  the  public  demands. 

The  quality  of  the  service  depends  on  the  proper  adjustment  and  balancing  of  these  ele- 
ments to  the  traffic. 

The  capacity  of  a  system  to  supply  service  rarely  interests  the  public  except  as  it  affects 
their  comfort.  If  added  only  when  and  as  needed  it  affects  the  cost  of  service  positively 
through  the  investment  required  to  obtain  it,  and  negatively  by  the  better  operating  conditions. 

Rapid  transit  lines  when  added  to  an  existing  surface  system  increase  its  capacity  and 
usually  increase  the  cost  of  service.  In  return  they  improve  the  sei-vice  rendered  in  limited 
areas  by  an  increase  of  speed  and  comfort  of  travel. 

Passenger  capacity  of  a  surface  system  is  the  product  of  many  factors  and  may  be  meas- 
ured by  the  maximum  number  of  cars  that  can  be  actually  operated  through  the  congested 
district  during  the  ' '  rush-hour, ' '  multiplied  by  the  number  of  passengers  per  car. 


Before  full  Ccapacity  of  the  lines  in  a  district  is  reached  relief  should  be  obtained  by  the 
addition  of  rapid  transit  lines.  As  the  improved  service  increases  the  speed  and  comfort  of 
travel  and  the  accessibility  of  the  congested  area,  such  area  becomes  more  attractive  and  grows 
at  the  expense  of  other  sections.  Hence  a  vicious  cycle  exists  which  produces  problems  for  city 
planners  and  transportation  engineers  to  solve.  Capacity  is  always  reached  first  in  the  busi- 
ness district  on  account  of  the  focusing  there  of  many  lines,  more  or  less  radial. 

The  existing  system  in  Philadelphia  is  approaching  the  limit  of  its  capacity  in  certain  lim- 
ited sections  of  the  business  district. 

In  this  report  the  cost  of  unified  service  has  been  estimated  carefully,  assuming  different 
terms  of  lease  and  giving  such  weight  to  each  of  the  elements  as  is  considered  to  meet  Philadel- 
phia requirements  as  to  quality.  The  cost  must  always  include  a  proper  return  upon  the  value 
of  the  plant  used  in  the  service. 

A  discussion  of  the  elements  of  transportation  service  is  beyond  the  scope  of  this  report. 

The  Fare  Element. 

The  fare  on  any  transportation  system  is  the  result  of  the  cost  of  the  service  divided  by 
the  number  of  passenger  journeys.  The  fare  is  thus  seen  to  vary  directly  with  the  cost  of  the 
service  and  inversely  with  the  number  of  passengers.    Expressed  in  a  formula,  it  is: 

Total  cost  of  the  service  ^^11  .^     1  ^ 

=The  average  actual  fare  per  journey. 


Number  of  complete  journeys 

Prom  this  formula,  with  any  two  elements  known  the  third  is  readily  found. 

In  this  discussion  the  term  "car  fare"  is  as  defined  above,  and  means  the  average  fare  re- 
quired to  siipport  the  service.  The  actual  fare  collected  on  the  cars  may  or  may  not  be  what  is 
here  called  the  "fare." 

From  this  it  is  evident  that  the  passenger  fare  required  to  support  the  service  is  not  a 
fixed  amount ;  it  varies  from  day  to  day,  from  year  to  year,  and  is  different  in  each  section  of 
the  city.  Like  many  other  elements  of  this  problem  dealing  with  the  city  as  a  whole  and  con- 
taining so  many  variables,  the  average  fare  required  must  be  used,  and  is  so  considered  in  this 
report. 

If  the  fare  collected  be  in  excess  of  the  fare  as  determined  by  the  formula,  a  surplus  will 
result,  available  for  distribution  between  the  City  and  lessee  according  to  the  provisions  of  the 
lease  of  the  lines.  If  the  fare  collected  be  less  than  the  fare  as  determined  above,  a  deficit  must 
result. 

The  actual  fare  is  fixed  hy  economic  conditions — the  fare  paid  is  fixed  by  City  ordinance 
or  the  operating  company. 

Diagram  No.  6  (facing  page  78)  shows  the  difference  between  the  two  as  applied  to  the 
Philadelphia  Rapid  Transit  Company  (actual  since  1900)  and  the  estimated  average  fares  re- 
quired up  to  1950  for  the  unified  system  known  as  No.  16  of  the  1915  Report. 

Statistics  show  that  with  any  given  system,  once  it  be  constructed,  the  increase  in  passen- 
gers is  usually  larger  than  the  corresponding  increase  in  the  cost  of  service,  and  thereby  a 
gradual  reduction  in  the  fare  reqiiired  becomes  possible  as  the  traffic  on  the  system  approaches 
the  capacity  for  which  it  was  designed. 

The  proposition  to  build  these  lines  out  of  City  funds  largely  arises  from  a  vague  idea  in 
the  public  mind  that  if  the  City  builds  these  lines,  a  5-cent  fare  will  render  the  service  profit- 
able now.    This  is  a  misconception,  for  the  resulting  rise  in  car  fare  takes  place  the  same  as 


though  the  lines  had  been  built  by  the  Company.  The  fact  that  the  rider  pays  only  5  cents  does 
not  prove  that  the  fare  to  support  the  service  has  been  only  5  cents.  A  deficit  resulting  from 
this  ear  fare  appears  first  as  a  deficit  in  the  City's  interest,  next  as  a  deficit  in  the  City  Treasury, 
next  as  an  increase  in  taxes  on  real  estate,  and  lastly  in  the  form  of  rent  or  increased  living  ex- 
penses, thus  reaching  the  citizen  by  an  indirect  route.  He  has  paid  the  increased  fare  (the 
excess  of  cost  of  service  over  5  cents),  but  not  in  a  direct  way. 

The  estimates  made  in  this  Department  show  that  the  ideal  condition,  the  profitable  oper- 
ation of  the  unified  system  on  a  5-cent  fare,  may  eventually  be  actually  possible.  It  is  not 
possible  now — the  actual  fare  on  the  existing  system  in  1915  being  5.166  cents  per  journey,  and, 
with  the  exception  of  three  years  when  strip  tickets  were  in  use,  the  fare  per  revenue  journey 
has  exceeded  5  cents  since  1895. 

Citizens  should  not  delude  themselves  into  the  belief  that  the  average  fare  is  only  5  cents 
now,  and  that  it  will  be  only  5  cents  with  the  City  as  a  partner  in  the  enterprise,  notwithstanding 
that  it  may  be  so  agreed  upon  and  stated  in  the  lease,  because  they  must  pay  the  full  fare  in 
one  shape  or  another,  whatever  it  may  be.  The  mere  fact  that  the  rider  does  not  pay  it  on  the 
car  should  not  blind  him  to  the  fact  that  the  cost  of  service  must  be  and  always  is  paid  in  full  in 
some  way. 

The  Five-Cent  Fare  Policy. 

It  becomes  necessary  for  the  City  to  lend  its  credit  in  financing  a  public  utility,  in  which 
the  income  does  not  meet  the  cost  of  service,  only  because  the  City  can  transfer  the  resulting 
loss  to  the  citizens  thi'ough  taxation.  The  citizens  bear  the  burden  of  loss  in  either  case.  The 
Company,  not  having  the  resource  of  public  taxation,  would  face  bankruptcy  under  the  same 
conditions. 

In  the  case  of  port  development,  where  the  City  is  in  competition  with  other  cities  for 
foreign  and  domestic  shipping  and  where  many  factors  in  the  problem  are  external  to  the  city 
and  not  in  its  control,  there  may  well  be  City  aid  in  its  development.  The  transit  problem, 
however,  is  an  internal  proilem,  of  local  interest  only — a  monopoly  of  local  transportation  wholly 
within  the  City's  control,  and  containing  within  itself  all  the  means  needed  for  its  solution. 
No  financial  aid  need  be  extended  by  the  City  if  the  public  insistence  upon  the  5-cent  fare  be 
temporarily  abandoned. 

As  shown  elsewhere  in  this  report,  should  the  comprehensive  system  be  built  at  a  cost  of 
say  $60,000,000  and  be  in  operation  in  1921,  as  per  Plan  No.  16  of  the  1915  Annual  Report  of 
the  Department  of  City  Transit,  under  the  terms  assumed,  the  resulting  car  fare  is  estimated 
to  be  about  5.59  cents,  which  is  about  8  per  cent,  higher  than  the  present  fare  of  5.166  cents,  or 
12  per  cent,  higher  than  the  ideal  5-cent  fare. 

If  the  "Progressive  Step"  program,  herein  outlined,  be  adopted,  and  Steps  Nos.  1  and  2  be 
in  use  in  1921,  under  the  same  assumptions,  the  fare  required  has  been  estimated  at  5.30  cents 
— about  3  per  cent,  increase  above  the  present  fare. 

All  propositions  heretofore  submitted  have  been  on  the  assumption  that  under  the  lease  of 
these  lines  to  the  Philadelphia  Rapid  Transit  Company  the  City  would  assume  all  excess  fare 
over  5  cents  up  to  the  limit  of  full  interest  and  sinldng  fund  on  the  bonds  issued  for  the  con- 
struction of  the  lines,  thereby  paying  about  12  per  cent,  of  the  car  fares  of  the  riders  in  1921. 

Should  the  City-built  lines  be  leased  on  a  basis  of  a  5-cent  flat  fare  (as  collected  on  the 
cars)  with  universal  transfers,  the  annual  loss  resulting  is  estimated  to  be  in  1921,  for  the  com- 
plete system : 

9 


-^  cents  X  555,000,000   passengers=$3,275,000, 
100 

or,  on  the  program  herein  outlined : 

Of) 

-^  cents  X  555,000,000   passengers=$l,665,000. 
100 

As  these  losses  (which  include  the  compensation  to  the  Philadelphia  Rapid  Transit  Com- 
pany for  loss  of  revenue  due  to  the  abolishment  of  the  8-cent  exchange  tickets)  must  be  borne 
by  the  City  up  to  the  limit  of  the  full  interest  and  sinking  fund  charges,  all  plans  heretofore 
have  proposed  that  the  City  shall  meet  them  by  a  tax  on  real  estate. 

It  may  be  assiuned  that  this  will  require  an  increase  in  1921  of  say  12  per  cent,  for  the 
complete  system,  or  perhaps  5  per  cent,  for  the  smaller  system.  Why  should  this  be  done? 
Why  should  not  the  City  insert  in  the  lease  of  the  lines  a  clause  providing  for  fare  adjust- 
ment to  meet  the  total  cost  of  service  which  may  be  outlined  as  follows : 

"Before  the  operation  of  any  part  of  the  complete  system  of  rapid  transit  lines  is 
begun  the  question  of  the  proper  fare  to  be  charged  in  order  to  meet  the  cost  of  the  ser- 
vice rendered  shall  be  reviewed  and  its  proper  amount  determined  by  the  Public  Service 
Commission  of  the  State  of  Pennsylvania,  and  the  Lessee  and  the  Department  of  City  Tran- 
sit shall  work  out  the  details.  This  fare,  v/hen  adjusted,  shall  be  subject  to  reduction  when 
cost  of  service  warrants. ' ' 

The  probable  fare  required  can  only  be  approximately  estimated  now,  as  it  will  be  affected 
by  the  amount  of  construction  authorized  during  the  period  of  inflated  prices. 

For  example,  under  such  a  provision  of  tlie  lease,  for  the  year  1921  and  thereafter  until 
the  cost  of  service  warrants  a  readjustment  in  the  City's  tax,  the  fare,  if  the  complete  system 
be  in  operation  as  per  Plan  No.  16  of  the  1915  Annual  Report  of  this  Department,  will  aver- 
age: 

5.166^  (Lessee's  present  fare)  +  0.425^  (City  Tax)=  5.591^  per  complete  journey. 

or,  if  Steps  Nos.  1  and  2  only  of  the  complete  plan  he  in  use,  the  fare  will  average : 

5.166<}  (Lessee's  present  fare)  +  0.134^  (City  Tax)  =  5.30^  per  complete  journey. 

The  lessee's  portion  of  the  fare  in  this  illustration  has  been  taken  at  the  present  rate  in  order 
that  the  loss  by  abolishment  of  8-cent  exchanges  to  the  Company  may  be  fully  met. 

Provision  should  be  made  in  the  lease  for  the  corresponding  increase  in  the  City  tax  por- 
tion of  the  fare  as  more  lines  are  added.  It  should  be  understood  that  the  figures  just  given 
are  for  illustrating  the  principle  only.  The  portion  of  the  fare  representing  the  City's  tax  is 
levied  to  meet  the  interest  on  bonds  issued  to  pay  for  the  new  rapid  transit  lines.  It  should  be 
collected  by  the  lessee  and  turned  into  the  City's  treasury  exactly  as  in  the  case  of  the  lease 
of  the  City's  gas  works.  This  tax  should  produce  the  revenue  needed  to  meet  the  City's  obli- 
gations— 

0.425^  X  555,000,000=$2,361,000    Interest  and  Sinking  Fund  on  $53,082,000  Bonds. 

0.134^  X  555,000,000=    $744,000    Interest  and  Sinking  Fund  on  $17,506,000  Bonds. 

10 


6LENSIDE 


SUBWAY  AND  ELEVATED  LINES  SUGGESTED 
<■  (Steps  1  and  2  shown  In  Red) 

gl  for 

.  _\.  _'!^(2yZ^^K IN  DEPENDENT  (COMPETITIVE)  SYSTEM 

and  Plan  of 
THROUGH-ROUTING  FOR  COMPREHENSIVE  SYSTEM 


ELEVATED 
^  ^  «•     SUBWAY 

EXISTING  TRACK 

—      NEW  TRACK 

EXISTING  TRACK 


LEGEND 

Rapid  Tranftit  Lmea 


Surface  F«e< 
_       _  Surfao«  Feci 

4^  ^  «-      NEWTHACK 
•     •     •       ProDOted  3Slh  Ward  High  Speed  Surra< 


I  Rao.d  Transit  Lifia* 


MAP   N0.1 


Slinuld  not  this  plan  lie  preferable  to  any  herotnfore  proposed,  and  meet  all  require- 
ments of  tlie  problem?  Under  it,  as  the  result  of  adding-  about  oue-half  cent  to  each  car  fare, 
commencing  in  1921, 

(a)  The  citizens  get  any  and  all  lines  as  and    when    they    order    them,    the    8-cent    ex- 

changes are  abolished  and  the  tax  rate  is  unaffected  by  the  transit  problem, 

(b)  The  City  gets  its  interest  and  sinking  fund  charges, 

(e)     The  present  rate  of  fare  of  the  lessee    (the  Philadelphia  Rapid  Transit  Company) 
will  not  be  disturbed. 

Hence  all  parties  interested  should  be  satisfied. 

It  will  not  be  attempted  here  to  furnish  details  as  to  how  this  average  fare  can  be  secured 
practically.  That  must  be  left  to  be  solved  in  connection  with  the  lease  of  the  lines.  It  should 
be  arranged  justly  and  equitably  and  it  is  entirely  feasible.  The  principle  must  be  settled  now. 
Shall  the  real  estate  taxes  be  raised  12  per  cent,  in  1921,  or  the  car  fares  raised  one-half  cent? 
The  interest  must  be  met  then  if  the  lines  are  built. 

The  question  involved  is  not  a  moral  one  of  right  or  wrong — it  is  a  question  of  expediency, 
of  determining  whether  the  citizens  who  enjoy  the  benefits  of  a  service  should  pay  the  full  cost 
of  the  service  which  must  always  include  a  proper  return  upon  the  value  of  the  plants  which 
supply  it. 

The  disposition  to  transfer  charges  for  puljlie  utilities  is  simply  an  indication  of  the  public 
desire  to  escape  from  taxes  wherever  possible,  and  results  from  a  fallacious  idea  that  a  trans- 
ferred tax  is  an  averted  tax. 

In  order  to  make  this  report  absolutely  clear  and  prevent  any  misunderstanding  of  the 
figures  and  facts  given  herein,  I  desire  to  emphasize  the  following  statement,  which  appears  in 
substance  in  other  places  in  this  report : 

All  the  subway  and  elevated  lines  included  in  the  ' '  Taylor  Plan, ' '  with  only  such  changes 
as  I  have  suggested  regarding  the  City  Hall  section  and  the  loop,  can  be  built  and  the  two 
systems  unified  without  any  increase  in  the  tax  rate,  if  the  people  are  willing  to  pay  an  aver- 
age fare  estimated  not  to  exceed  5-^  cents  commencing  in  1921,  which  will  take  care  of  the 
City's  interest  and  sinking  fund  charges.  This  fare  may  be  reduced  gradually  until  it 
reaches  5  cents  about  1960. 

Elsewhere  in  this  report  is  explained  the  alternative — the  effect  on  the  tax  rate  if  the  fare 
be  not  raised. 

Independent  Operator  of  City's  Lines. 

As  stated  elsewhere,  this  and  all  previous  i-eports  made  by  the  Department  have  assumed 
and  recommended  that  the  existing  and  the  new  systems  be  operated  in  combination. 

Should  such  a  result  finally  be  found  to  be  impossible  or  inexpedient,  for  reasons  financial 
or  otherwise,  an  alteration  of  routing  will  be  desirable  as  the  lines  will  then  be  operated  in  com- 
petition with  the  existing  system  and  not  as  a  supplement  to  it. 

Map  No.  1  shows  the  suggested  arrangement  for  a  competitive  system.  The  map  clearly 
shows  that  a  system  of  this  kind  would  work  great  damage  to  the  existing  system  but  that  it 
could  later  be  used  to  supplement  that  system.  By  the  general  law  of  economies  the  new  lines, 
though  originally  leased  to  an  independent  operator,  will  probably  at  some  time  be  unified  with 
the  existing  system. 

11 


Burden  Not  Realised  Now. 

A  seductive  feature  of  the  present  financial  plans  for  the  construction  of  the  rapid  transit 
lines  is  found  in  the  proposal  to  issue  City  bonds  under  the  provisions  of  the  recent  Act  pro- 
viding for  a  life  of  50  years,  the  payment  of  the  interest  and  sinking  fund  charges  during  the 
period  of  construction,  and  one  year  thereafter,  out  of  the  proceeds  of  the  bonds  themselves,  and 
a  gradual  sinking  fund — all  features  expected  and  intended  to  place  as  much  of  the  burden  as 
possible  on  posterity.  The  seductive  feature  is  in  the  fact  that  the  burden  will  not  be  real- 
ized until  possibly  four  years  after  the  lines  are  authorized. 

Legal  Questions  Not  Discussed. 

It  is  not  my  purpose  in  this  report  to  try  to  pass  on  or  discuss  the  legal  phases  of  the  au- 
thorization by  City  Councils  of  the  lines  covered  in  the  Ordinance  of  July  2,  1915,  and  the  loan 
bill  approved  June  30,  1915,  or  to  discuss  how  they  may  be  affected  by  tlie  conditions  and  limita- 
tions named  therein,  or  to  argue  the  point  as  to  whether  such  limitations  were  right  and  proper 
from  other  standpoints.  I  shall  leave  that  to  be  determined  by  the  proper  authorities,  who  will 
take  such  action  in  regard  to  it  as  they  deem  best.  This  matter  must  be  passed  on  by  the 
Public  Service  Commission  in  any  event.  In  this  report  I  have  made  my  recommendations 
along  lines  which  I  regard  as  sound  and  businesslike  aud  wdtli  full  regard  to  the  responsibilities 
devolving  on  the  taxpayers  by  reason  of  the  cost  of  this  undertakng.  No  section  of  the  city 
has  been  intentionally  favored  at  the  expense  of  others.  Naturally  and  properly  each  section 
aims  to  secure  the  best  transit  facilities  obtainable  to  serve  its  people.  In  suggesting  means  to 
meet  the  transit  needs  of  the  entire  city,  I  have  been  guided  by  the  respective  urgency  of  these 
needs  and  have  formulated  a  schedule  of  construction  for  transit  development  which  wiU  event- 
ually serve  all  sections  of  the  city  and  not  to  impose  an  unprofitable  liability  on  the  taxpayers 
or  undue  burden  upon  the  car  riders.     (See  note  and  City  Solicitor's  opinion — Appendix  C.) 

Data  Forming  Basis  of  this  Report. 

The  technical  data  upon  which  this  report  is  based  are  the  same  as  those  upon  wliich  pre- 
vious reports  of  this  Department  have  been  based. 

General  Principles. 

As  it  is  very  desirable  to  make  a  munieipally-owned  rapid  transit  system  a  commercially 
successful  business  proposition,  or  as  nearly  self-supporting  as  possible,  in  order  to  avoid  the 
alternative  of  making  up  from  general  taxation  the  deficit  in  the  City's  bond  interest  and  sink- 
ing fund,  it  becomes  most  essential  to  observe  in  the  design  of  the  system  certain  principles 
which  may  be  fairly  regarded  as  axiomatic. 

These  principles  may  be  briefly  stated  as  follows : 

1.  Locate  rapid  transit  lines  in  general  along  direct  routes  where  the  congestion  has  be- 
come too  great  for  surface  lines  to  run  at  fair  speed  and  to  properly  take  care  of  the  trafSc ; 
the  main  object  of  rapid  transit  lines  in  a  unified  system  is  to  supplement  the  surface  car 
service  by  removing  therefrom  a  large  part  of  the  passenger  traffic  and  placing  this  traffic 
above  or  below  the  street  level  where,  being  free  from  interference  with  other  traffic,  much 
higher  speed  can  be  maintained  and  larger  and  heavier  trains  operated. 

12 


2.  Construct  each  line  in  progressive  steps,  completing  the  most  urgently  needed  section 
first  and  adding  extensions  or  branches  only  as  their  necessity  or  feasibility  is  demonstrated. 

3.  Plan  the  system  as  a  comprehensive  whole  conforming  to  the  ideal  plan  as  nearly  as 
local  conditions  permit  and  with  the  underlying  idea  of  operating  all  trains  on  the  principle  of 
through-routing  as  far  as  possible,  as  this  is  now  universally  conceded  to  be  the  proper  method 
of  operation.    Avoid  the  so-called  ' '  looping ' '  method  of  operation  wherever  possible. 

4.  Construct  the  minimum  amount  of  subway  line,  as  this  is  the  most  expensive  form  of 
construction  and  hence  carries  the  highest  interest  charge  per  mile.  As  a  corollary  of  this,  sub- 
ways should  be  built  only  where  no  other  form  can  be  used  or  accepted  on  account  of  high 
property  damages  resulting  from  the  use  of  any  other  form,  or  for  esthetic  reasons,  or  where 
some  special  or  peculiar  conformation  of  the  streets  makes  a  subway  imperative. 

5.  Construct  rapid  transit  lines  to  such  points  only  in  the  outlying  districts  as  will  pro- 
vide sufficient  traffic  to  load  the  lines  to  an  economical  amount.  Beyond  such  points  the  traffic 
should  be  carried  by  either  surface  lines  or  by  other  cheaper  forms  of  high-speed  construction. 

6.  Locate  rapid  transit  lines  in  the  business  district  so  they  will  act  as  channels  through 
which  the  main  traffic  flow  between  the  residential  and  business  districts  may  be  conveyed  with- 
out confusion  or  congestion,  and  so  as  to  require  a  minimum  of  transferring  to  reach  the  rider's 
destination. 

7.  Utilize  existing  surface  car  facilities  to  the  fullest  extent  possible  and  supplement  them 
by  high-speed  surface  extensions  into  the  suburbs,  located  on  wide  streets  or  private  right-of- 
way  so  as  to  provide  economically  for  the  development  of  the  territory  adjacent  or  tributary 
to  the  rapid  transit  lines. 

In  my  judgment,  some  of  the  plans  and  recommendations  offered  in  the  1915  Annual  Re- 
port of  this  Department  by  my  predecessor  should  be  modified  in  accordance  with  the  fore- 
going principles. 

While  it  would  be  much  easier  to  accept  such  plans  and  recommendations  as  promulgated 
than  to  convince  the  public  that  it  is  desirable  from  their  standpoint  to  make  alterations  in  them, 
I  believe  it  will  be  to  the  City's  interest  financially  and  to  the  general  welfare  of  the  passen- 
gers on  tbese  lines  to  make  certain  modifications  which  will  tend  to  expedite  construction,  re- 
duce the  cost  of  construction  and  operation,  and  also  facilitate  traffic  movement  to  a  greater 
degree  than  the  plans  formerly  recommended. 

The  general  location  of  the  main  radial  lines  cannot  be  improved  and  such  lines  will  serve 
the  City's  needs  adequately  for  many  years  to  come,  but  the  arrangement  of  the  loop  or  ter- 
minal tracks  in  the  delivery  or  business  district  of  the  City  I  believe  to  be  capable  of  improve- 
ment so  as  to  permit  a  more  economical  use  of  the  City's  streets  and  a  more  efficient  method 
of  through-routing  the  rapid  transit  trains. 

Also,  for  financial  reasons,  I  do  not  favor  the  construction  program  as  outlined, — as  a  busi- 
ness project  it  should  be  broken  into  progressive  steps  to  allow  the  City  and  the  lessee  intervals 
of  time  in  which  to  digest  and  assimilate  each  addition  to  the  system. 

The  Financial  Difficulties  of  the  Problem  of  City-Owned  Lines. 

Rapid  transit  problems  have  developed  in  all  large  cities  as  one  of  the  penalties  that  they 
must  pay  for  bigness  or  for  over-size. 

Usually  no  such  problem  exists  until  the  city  reaches  500,000  population,  or  its  residential 
section  extends  more  than  three  miles  from  the  business  district. 

2  13 


The  difficulty  of  financing  rapid  transit  propositions  is  that  they  must  be  built  originally 
with  train  and  passenger  capacity  largely  in  excess  of  the  existing  needs.  They  do  not  increase 
the  total  volume  of  riding  in  a  city  to  any  great  extent  and  the  greater  part  of  their  traffic 
is  taken  from  other  lines  from  which  they  draw  by  virtue  of  providing  better,  quicker  or  more 
frequent  service,  or  of  providing  satisfactory  service  at  a  lower  fare. 

The  Germantown  district  today  is  served  by  two  direct  lines  of  surface  cars  from  the  center 
of  the  city,  and  by  two  steam  roads  giving  frequent  service.  The  complaint  from  this  district 
i.s  that  the  surface  cars  are  too  slow  and  on  the  steam  cars  the  service  is  too  infrequent  and 
the  fare  is  too  high.  What  is  desired  by  these  residents  is  the  quick  and  comfortable  service 
of  the  steam  roads  at  the  5-cent  fare  limit  together  with  the  frequent  service  of  the  surface 
roads.  This  is  equivalent  to  an  improvement  of  service,  and  a  fare  reduction  at  the  same  time. 
The  problem  which  the  City  is  attempting  to  solve  seems  to  have  but  two  answers — either  a 
higher  unit  fare  than  5  cents  per  passenger,  or  the  City  must  assist  the  operator  of  the  lines 
by  assuming  at  the  start  a  large  share  of  the  interest  charges  on  the  rapid  transit  system. 

Why  Does  the  City  Engage  in  this  Experiment? 

Because  the  proposed  rapid  transit  lines  are  not  attractive  to  private  capital. 

A  city  is  an  assemblage  of  people  organized  for  the  purpose  of  securing  the  benefits — 
social  and  commercial — of  combined  sei-vice  and  effort.  A  city  will  continue  to  grow  so  long 
as  the  conditions  of  life  therein  are  acceptable  and  inviting.  Such  growth  calls  for  a  larger 
land  area  for  residential  purposes  each  year,  and  such  land  is  now  located  chiefly  in  the  city's 
suburbs.  New  and  suburban  development  causes  a  diversion  of  tenants,  especially  from  the 
older  and  less  desirable  sections  of  the  city,  to  those  new  sections  where  they  can  obtain  for 
the  same  or  less  rent  more  desirable  surroundings.  The  newer  and  suburban  districts  prosper 
at  the  expense  of  the  older  parts  of  the  city  lying  between  the  first  and  fourth  mile  zones. 

Rapid  transit  lines  do  not  directly  affect  the  growth  of  a  city,  as  this  growth  is  from  two 
sources : 

1.  By  accretions  from  without,  and 

2.  By  increase  of  population  from  within. 

These  lines  shift  population  and  traffic  from  one  district  to  another  more  favorably  situ- 
ated. 

The  population  of  a  city  consists  of  people  who  are  engaged  in  commercial  or  mercantile 
industries  or  manufacturing,  either  as  employers  or  employees,  and  the  transit  facilities  of  a 
city  are  primarily  not  for  pleasure  purposes,  but  to  convey  the  population  between  their  homes 
and  their  work,  or  between  their  homes  and  trading  points. 

As  the  main  city  grows  constantly  on  the  outer  fringe  it  will  be  found  that  building  de- 
velopment usually  follows  close  upon  the  introduction  of  so-called  city  improvements  (grading 
of  streets,  sewerage,  water  and  gas  supply,  etc.). 

Surface  transit  facilities  in  the  past,  while  such  development  was  within  the  four-mile 
circle,  have  usually  kept  pace  fairly  well  with  the  demands,  but  as  the  residential  area  is  being 
pushed  farther  and  farther  from  the  city's  center  there  is  more  reluctance  on  the  part  of  the 
street  car  companies  to  follow  the  development.  Further,  as  the  distance  traveled  daily  by 
riders  increases,  more  need  is  felt  for  quicker  transit  than  surface  lines  can  provide.  This  has 
produced  a  demand  which  the  present  Company  in  Philadelphia  is  not  able  to  assume  the  fin- 
ancial burden  of  supplying.     This  fact  only  has  brought  the  City  face  to  face  with  the  prob- 

14 


lem  which  it  is  proposed  to  solve  by  the  City  lending  its  credit  and  assuming  liability  for  in- 
terest on  the  cost  of  constructing  such  facilities. 

Kapid  transit  lines,  while  in  general  providing  for  the  comfort  and  convenience  of  the 
traveling  public,  have  also  a  commercial  side. 

Such  rapid  transit  lines  as  have  been  built  in  the  past  were  originated  as  business  ven- 
tures with  the  primary  view  of  making  money  for  their  builders.  In  very  few  cases,  however, 
have  the  expectations  of  the  original  builders  or  promoters  been  realized. 

Why  Called  an  Experiment? 

This  enterprise  upon  which  the  City  has  embarked  has  been  called  an  experiment;  it  may 
be  asked  why  is  it  considered  an  experiment? 

It  is  a  test  on  a  large  or  working  scale  of  an  untried  combination  of  elements  to  ascertain 
the  truth  or  practicability  of  the  principles  underlying  the  combination. 

In  no  other  city,  particularly  one  with  the  population  and  covering  the  area  of  Philadel- 
pliia,  has  it  been  attempted  to  combine  and  unify  the  operation  of  surface  and  rapid  transit 
systems,  giving  free  interchanges  at  all  points  of  intersection,  on  a  5-cent  fare,  the  routes 
and  extensions  being  under  the  control  of  a  eouncilmanic  body,  and  it  being  tentatively  assumed 
that  all  the  burden  of  the  construction  of  the  system  shall  constitute  the  city's  liability — no 
guarantee  by  company  to  protect  city  from  loss. 

The  transportation  system  in  Boston  resembles  what  is  contemplated  for  Philadelphia 
more  nearly  than  that  of  any  other  city.  But  in  Boston  the  program  has  been  so  arranged 
that  the  facilities  have  been  added  gradually  over  a  20-year  period,  and  the  entire  burden  car- 
ried by  the  Boston  Elevated  Railway  Company.  Up  to  1915  not  one  dollar  of  the  City's  money 
has  been  used  to  make  up  deficits  in  the  City's  interest  due  to  lack  of  income. 

The  New  York  leases  under  the  "dual  system"  resemble  what  is  here  proposed,  but  in  New 
York  no  attempt  has  been  made  to  secure  a  unified  system.  In  the  New  York  territory  are 
three  high-speed  systems  and  four  surface  systems  operating  independently.  The  results  in 
Boston  are  not  satisfactory  to  the  lessee  company,  but  appear  to  be  to  the  City. 

In  New  York  City  the  "dual  system"  will  not  be  in  use  for  some  months  at  least,  so  it  is 
too  early  to  judge  results. 

Main  Issues. 

The  real  issue  to  be  decided  is  not  "Shall  the  Broad  Street  Line  stop  temporarily  at  Erie 
Avenue  and  at  Spruce  Street?"  but  the  much  larger  issues,  "Shall  this  undertaking  be  handled 
on  a  business  or  a  political  basis ;  shall  the  City  build  according  to  its  necessities  or  according 
to  unwarranted  sectional  demands;  shall  Councils  be  guided  by  the  advice  of  its  Director  of 
Transit  (or  a  board  of  capable  and  locally  disinterested  men),  or  by  the  demands  of  aggressive 
and  energetic  citizens,  actuated  by  local  interests?" 

The  City  has  reached  tlie  parting  of  the  ways — it  must  make  a  decision  now  as  to  the  under- 
lying principles  and  policies  which  are  to  govei-n. 


A    STUDY    OF    THE    RAPID    TRANSIT    PROBLEM    IN    PHILADELPHIA 

WITH 
SUGGESTIONS    FOR    ITS    PROPER    DEVELOPMENT 


SUmiARY  OF  REPORT. 


The  purpose  of  this  Report  upon  the  Rapid  Transit  Problem  in  the  City  of  Philadelphia 
is  to  call  attention  to  certain  features  which  I  regard  as  unwise  and  inexpedient  in  the  con- 
struction and  financial  programs  for  the  vast  undertaking  upon  which  the  City  has  taken  the 
initial  steps,  and  to  present  suggestions  as  to  construction  and  the  methods  of  financing  the 
construction  cost  and  deficits  from  operation  in  interest  charges  that  should  effect  (a)  economy 
in  its  construction,  (b)  a  proper  conservation  of  City  funds  and  revenue,  and  (c)  an  improve- 
ment in  the  service  of  the  system. 

The  program  upon  which  the  City  has  entered  is  fully  set  forth  in  the  report  of  this  De- 
partment for  the  year  1915,  which  contemplates  and  recommends  the  inmiediate  construction 
of  a  comprehensive  system  of  rapid  transit  lines  extending  into  several  outlying  districts  of  the 
city,  involving  on  the  City's  part  an  initial  investment  of  $56,000,000  or  more  of  City  funds 
for  construction  (in  addition  to  private  funds  for  equipment),  and  requiring  annually  an  ad- 
ditional investment  from  City  revenue  to  meet  deficits  in  interest  charges. 

This  report  is  not  to  promulgate  a  new  plan  of  routes  or  lines,  and  it  clearly  sets  forth 
the  fact  that  in  the  general  routes  and  extent  of  the  lines  as  laid  down  in  all  former  reports 
between  the  suburbs  and  the  business  center  of  the  city  no  change  is  suggested  as  they  are  not 
open  to  criticism.  A  change  of  lines  and  of  location  of  stations  within  the  business  district  is 
suggested  for  reasons  fully  given. 

It  assumes  that  everyone  will  admit  that  this  comprehensive  system  is  intended  to  take  care 
of  the  growth  of  Philadelphia  for  forty  years  to  come — a  metropolitan  Philadelphia  with 
3,000,000  population. 

It  assumes,  as  all  previous  reports  have  done,  that  whenever  and  whatever  rapid  transit 
lines  are  built,  they  will  be  operated  by  the  Philadelphia  Rapid  Transit  Company,  the  surface 
and  rapid  transit  lines  being  operated  as  a  imified  system. 

It  also  clearly  shows  that  the  extent  of  the  financial  burden  resulting  from  the  construc- 
tion and  operation  of  this  system  will  depend  directly  on  the  answers  to  the  following  questions 
in  which  every  citizen  is  financially  interested,  either  directly  or  indirectly : 

(a)  What  lines  shall  be  built? 

(b)  How  far  shall  they  be  built  from  the  center  of  the  city? 
(e)     "When  shall  they  be  built? 

(d)  Who  shall  pay  for  them? 

(e)  Shall  lines  to  develop  suburban  property  be  built  with  City's  funds;  or  shall  the 

property  benefited  share  in  the  cdst? 

(f)  Who  shall  operate  them? 

17 


(g)     Upon  what  terms  shall  they  be  leased? 

(h)     How  shall  deficits  in  City's  interest  charges  on  bonds  be  met? 

(i)     Shall  the  burden  be  put  upon  the  City  taxes  on  real  estate  and  personal  property, 

or  upon  the  car  rider  ? 
(j)     If  deficits  are  to  be  met  out  of  the  City  revenue,  what  effect  will  it  have  on  the  tax 

rate? 

(k)     If  deficits  are  to  be  met  by  an  increase  in  fare  to  the  car  rider,  shall  it  be  a  uniform 
increase,  or  shall  the  riders  on  the  rapid  transit  lines  only  pay  the  increase? 

(1)     Why  should  the  City  engage  in  this  experiment  in  transportation? 

(m)  Why  is  this  called  an  experiment? 

All  these  questions  are  fully  discussed  in  the  body  of  the  report  with  a  view  to  explaining 
some  points  not  clearly  brought  out  in  former  reports  and  discussions  of  this  experimental 
undertaking  upon  which  the  City  has  now  embarked. 

It  assumes  what  all  previous  reports  have  shown — that  the  operation  of  the  unified  system 
will  not  produce  sufficient  net  income  to  meet  the  requirements  of  the  operator  and  the  City's 
interest  and  sinking  fund,  thereby  creating  a  deficit  in  the  City's  account. 

It  shows  what  causes  these  deficits,  of  what  they  are  made  up,  and  suggests  methods  of 
meeting  them. 

It  shows  that  the  average  fare  per  journey  on  the  present  system  is  in  excess  of  five 
cents,  and  that  five  cents  flat  is  inadequate  to  furnish  the  required  net  income. 

It  lays  down  the  general  principles  on  which  rapid  transit  lines  should  be  designed, 
and  also  contains  a  general  discussion  of  rapid  trapsit  in  modern  cities,  showing  what 
would  constitute  an  ideal  system  of  unified  operation,  and  shows  the  true  function  of  surface 
and  rapid  transit  lines  in  unified  and  competitive  operation.  It  discusses  at  length  the  proper 
distribution  of  the  burden  which  will  result  to  the  City  from  the  operation  of  this  system,  and 
suggests  methods  of  financing  which  should  serve  to  check  unwarranted  expansion  of  the  system 
and  which  should  reduce  the  operating  deficits. 

Two  appendices  are  added  treating  on  the  principle  of  assessing  the  cost  of  public  im- 
provements upon  the  territory  receiving  the  benefit  of  such  improvements. 

The  features  of  the  City's  present  program  which  I  regard  as  unwise  and  inexpedient 
consist  of: 

1.  The  undertaking  of  the  whole  construction  program  at  once  during  an  era  of  abnor- 
mally high  prices  and  before  the  operator  of  the  system  has  been  determined  upon,  and  before 
settlement  upon  the  terms  of  a  lease  for  the  operation  of  the  lines  upon  their  completion. 

2.  The  financing  entirely  by  City  funds,  of  the  construction  of  branch  lines  in  suburban 
or  undeveloped  districts  where  the  traffic  will  for  many  years  be  inadequate  to  warrant  such 
outlay. 

3.  The  diversion  from  the  City's  treasury  of  revenue  from  the  general  tax  funds  for 
the  payment  of  deficits  in  interest  and  sinldng  fund  charges  on  City  bonds  issued  to  pay  for 
the  construction  of  the  system. 

4.  The  location  of  certain  lines  and  stations  within  the  business  district  and  the  conse- 
quent method  of  routing  trains. 

18 


The  suggested  improvements  in  the  program  are: 

1.  That  the  terms  on  which  a  comprehensive  system  of  rapid  transit  lines  can  be  leased 
to  an  operator  be  ascertained,  and  that  no  more  construction  than  is  now  authorized  be  under- 
taken until  it  is  definitely  known  by  whom  the  entire  system  is  to  be  operated  and  upon  what 
terms. 

2.  Divide  the  comprehensive  plan  of  routes  into  two  parts  (see  Map  No.  5) : 

(a)  The  sections  forming  the  trunk  lines,  in  and  through  the  25-minute  street  car  zone 

from  City  Hall.  These  lines  to  be  considered  as  terminals  and  trunk  lines,  and 
being  for  the  general  benefit  of  the  city  as  a  whole  they  should  be  financed  on 
City  bonds. 

(b)  All  extensions  and  branches  of  such  lines  into  outlying  or  suburban  territory  are  to 

be  considered  as  for  local  benefit  chiefly,  and  the  cost  of  construction  of  such  ex- 
tensions and  branches  should  be  borne  by  the  property  in  the  territory  served  by 
them.  As  legal  authority  for  such  method  of  financing  these  extensions  is  lacking, 
it  is  suggested  in  this  report  that  proper  laws  be  passed  at  the  next  Legislature  to 
empower  the  City  to  make  use  of  this  method  at  its  option.  Extensions  to  the 
trunk  system  will  not  become  necessities  immediately,  and  as  even  the  trunk  sys- 
tem will  not  be  ready  for  use  under  three  years  from  date,  ample  time  is  available 
for  obtaining  such  legislation.     (See  Opinion  of  City  Solicitor — Appendix  C.) 

3.  Construct  at  this  time  of 'abnormally  high  prices  only  such  portion  of  the  trunk  lines 
as  may  be  considered  the  necessary  and  terminal  sections,  viz. :  Part  of  the  Broad  Street  Subway 
and  the  Prankford  Elevated — the  subway  to  extend  from  Spruce  Street  to  Erie  Avenue  or 
Pike  Street  with  a  line  on  Walnut  Street  from  Sixteenth  Street  to  Eighth  Street,  on  Eightli 
Street  to  Race  Street  and,  by  the  opening  of  Ridge  Avenue  between  Eighth  and  Ninth  Streets, 
on  Ridge  Avenue  from  Race  Street  to  Broad  Street,  the  line  from  Ridge  Avenue  to  Pike  Street 
to  be  4-track  and  the  remainder  2-track.  The  Frankford  Elevated  to  terminate  for  the  present 
at  Bridge  Street.  All  terminals  to  be  considered  temporary  only,  and  sequence  of  construc- 
tion of  the  remainder  of  the  trunk  routes  to  be  the  subject  of  later  determination  as  conditions 
warrant. 

It  is  suggested  that  there  be  two  tracks  only  in  Broad  Street  at  Market  Street,  and  that 
the  City  Hall  Station  be  located  just  north  of  City  Hall  instead  of  under  it,  thereby  bringing  the 
platforms  much  nearer  the  surface  of  the  street,  and  greatly  lessening  the  cost  of  construction, 
and  separating  this  station  further  from  the  Chestnut  Street  Station,  and  reducing  congestion 
at  City  Hall.     (See  Maps  Nos.  6  and  7.) 

4.  Construct  at  such  later  dates  and  to  such  extent  and  in  such  sequence  as  they  may  be 
properly  authorized,  the  remainder  of  the  comprehensive  system  of  lines  needed  and  now  contem- 
plated. 

5.  Take  steps  to  obtain  the  necessary  legislation  to  empower  the  City  to  finance  the  con- 
struction of  the  extensions  by  means  of  bonds,  the  interest  on  which  can  be  met  by  local  assess- 
ment on  the  pi'operty  in  the  districts  served.     (See  Opinion  of  City  Solicitor — Appendix  C.) 

This  report  endeavors  to  make  clear  that  the  fundamental  issues  involved  in  this  problem 
now  before  the  people  are  not  personal,  but  municipal. 

19 


These  issues  are: 

1.  Shall  the  City  in  return  for  the  burden  it  assumes  receive  a  fraction  of  the  financial 
profits  which  will  result  from  these  lines ;  or  shall  these  benefits  all  flow  toward  the  enrichment 
of  a  small  number  of  suburban  land  o\Miers  and  operators  in  real  estate? 

2.  Shall  the  City  embark  in  a  vast  experiment  in  city  transportation  gradually  and  with 
fair  business  caution ;  or  shall  it  provide  the  facilities  now  for  two  generations  ahead  and  assume 
the  increased  liabilities  which  result? 

3.  Shall  the  turden  of  deficits  be  placed  on  the  property  of  the  citizens  in  the  shape  of 
an  increase  of  taxes?  or,  I 

4.  Shall  this  burden  be  placed  in  part  at  least  on  the  ones  benefited ;  namely,  on  the  car 
riders  by  an  increase  of  fare  ? 

These  questions  must  be  answered  by  every  citizen  for  himself — upon  him  alone  rests  the 
responsibility  for  the  results  of  the  decision. 


20 


A  HISTORY  AND  ANALYSIS  OF  THE  PLANS    FOR    RAPID    TRANSIT 
DEVELOPMENT  IN   PHILADELPHIA.   1913-1916 


On  May  27,  1912,  the  Hon.  Rudolph  Blankenburg,  then  Mayor  of  Philadelphia,  appointed 
Mr.  A.  Merritt  Taylor,  a  man  of  vision,  constructive  ability  and  experience  in  railroad 
operation  and  finance,  as  Transit  Commissioner,  "to  investigate  the  problems  of  improved  tran- 
sit facilities  for  Philadelphia,  with  a  view  of  determining  advisable  means  for  obtaining  rapid, 
efficient  and  cheap  transit  throughout  the  city  and  its  suburbs  by  the  use  of  subways  or  other 
approved  modern  methods,  to  consider  fully  the  question  of  public  and  private  ownership  and 
the  financial  and  economic  aspects  of  the  problem,  •  *  *  to  recommend  ways  and  means 
whereby  efficient  and  rapid  transit  commensurate  with  the  present  and  future  needs  of  the 
entire  city  and  its  suburbs  may  be  secured  within  a  reasonable  number  of  years." 

The  report  which  resulted  from  this  appointment  was  issued  in  July,  1913,  and  constituted 
the  original  "Taylor  Plan"  of  rapid  transit  development  for  Philadelphia  and  vicinity. 

On  July  1,  1913,  Mr.  Taylor  was  appointed  Director  of  the  Department  of  City  Transit. 
This  Department  was  organized  in  compliance  with  the  Act  of  Legislature,  approved  May  9, 
1913.  The  Act  creating  this  Department  provides  that  "The  Director  shall  from  time  to  time 
make  such  recommendations  to  the  Councils  of  said  cities,  as  to  him  shall  seem  proper,  for  the 
improvement  and  development  of  the  facilities  for  transportation  of  persons  and  property 
within  said  cities." 

In  accordance  with  this  mandate,  several  reports  were  issued  by  the  Department  of  City 
Transit  during  the  period  ending  December,  1915. 

Outline  of  the  Case. 

The  latest  plans  for  tran.sit  development  in  Philadelphia,  popularly  known  as  the  ' '  Taylor 
Plans,"  comprise  the  following  salient  elements: 

(a)  A  proposal  that  the  City  shall  supply  all  funds  for  construction  of  a  comprehensive 
system  of  rapid  transit  lines  to  supplement  the  present  system. 

(b)  A  recognition  of  the  fact  that  City  Councils  shall  determine  when  and  where  such 
lines  shall  be  built  and  how  financed. 

(e)  A  proposal  that  the  City-built  lines  shall  be  leased  to  the  Philadelphia  Rapid  Transit 
Company,  for  operation  in  connection  with  the  present  system,  with  free  transfers. 

(d)  A  proposal  to  lease  the  City-built  lines  to  an  independent  operator  if  a  satisfactory 
lease  with  the  Philadelphia  Rapid  Transit  Company  cannot  be  secured. 

(e)  A  proposal  that  the  lessee  shall  supply  all  funds  needed  for  the  equipment  of  the 
City-built  lines  and  for  all  extensions  of  the  surface  system. 

(f)  A  proposal  that  the  fare  per  journey  as  paid  on  the  cars  shall  be  5  cents  only. 

(g)  A  proposal  that  the  City  shall  transfer  all  excess  of  cost  of  service  over  the  revenue 
derived  from  a  5-cent  fare  to  the  real  estate  taxes  of  the  City,  up  to  the  full  cash  requirements 
of  its  bond  interest  and  sinking  fund. 

(h)  The  assumption  that  the  Philadelphia  Rapid  Transit  Company  will  be  the  operator 
of  the  entire  system. 

21 


(i)  A  modification  of  the  "Contract  of  1907"  between  the  City  and  the  Philadelphia 
Rapid  Transit  Company,  with  an  extension  of  scope. 

Elements  (b),  (f)  and  (g)  contain  the  dangerous  features  of  the  program — (b)  because 
it  recognizes  a  political  control  of  what  is  a  highly  complex  business  problem  in  transportation, 
and  (f)  and  (g)  because  they  are  fallacious  in  principle  and  socialistic  in  theory. 

Former  Taylor  Plans  Analyzed. 

In  speaking  of  the  "Taylor  Plan"  there  seems  to  be  a  general  impression  in  the  minds  of 
the  public  that  it  is  something  fixed  and  unalterable ;  a  perfect  conception,  and  therefore  not  sub- 
ject to  improvement.  In  order  to  show  that  the  "Taylor  Plan"  of  December,  1915,  differs  very 
considerably  from  the  plan  promulgated  in  the  Transit  Commissioner's  Report  of  1913,  I  sub- 
mit the  following  comparative  statement  showing  the  changes  that  were  made  in  the  plan  year 
after  year.  Elsewhere  in  this  report  will  be  found  explanations  of  some  of  the  changes,  and 
this  introduction  is  for  the  purpose  of  making  clear  that  it  is  a  review  of  the  different  "Taylor 
Plans"  indicating  some  of  the  defects  which  have  become  evident  with  later  study,  and  making 
suggestions  for  further  improvement.  This  report  may  be  regarded  as  a  fourth  edition  of  those 
plans.     (See  Statement  1.) 

If  the  comparative  statement  of  the  original  and  the  final  "Taylor  Plans"  be  analyzed  it 
will  be  found  that  running  through  them  are  certain  fundamental  elements   (see  Statement  3)  : 

1.  The  comprehensive  program  of  construction  of  lines  radiating  from  the  center  of  the 
city  into  the  outlying  districts. 

2.  A  financial  plan  using  the  City's  credit  to  a  greater  or  less  extent  for  the  purpose  of 
financing  different  portions  of  the  system. 

3.  A  unified  system  of  operation  in  connection  with  the  existing  system,  the  assumed  basis 
being  in  all  cases  a  lease  of  the  City-built  lines  and  a  uniform  fare  over  the  entire  city. 

4.  The  elimination  of  the  8-cent  exchanges  and  the  substitution  for  them  of  free  transfers. 
This  was  not  mentioned  in  the  original  ' '  Taylor  Plan ' '  and  has  been  developed  during  the  nego- 
tiations made  in  the  attempt  to  secure  unified  operation  under  a  modification  of  the  1907  Con- 
tract. 

In  each  of  the  plans  the  equipment  of  the  City-built  lines  is  assumed  to  be  furnished  by 
the  lessee  of  the  lines. 

Taylor  Plans — Comparison  of  Previous  Recommendations. 

A  comparison  of  the  recommendations  of  the  Report  of  1913  with  the  Report  of  1915  shows 
that  the  City's  credit,  which  at  first  was  to  be  used  to  the  extent  of  about  $35,000,000  for  the 
construction  of  the  Broad  Street  Line  with  branches  and  Delivery  Loop  only,  has  expanded  to 
over  $60,000,000,  now  covering  the  entire  construction  of  a  more  comprehensive  system  than 
was  contemplated  in  1913,  as  the  1915  plans  include  the  29th  Street— Roxborough  Line  and  the 
high-speed  surface  line  in  the  35th  Ward,  which  were  not  a  part  of  the  original  recommenda- 
tions. 

Furthermore,  the  elevated  parts  of  the  system,  which  were  originally  expected  to  be  built 
and  owned  by  the  Philadelphia  Rapid  Transit  Company  are  in  the  later  plans  to  be  built  and 
owned  by  the  City  and  operated  by  the  Philadelphia  Rapid  Transit  Company  under  the  gen- 
eral lease. 

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27 


Statement  2 

COMPARISON  OP  THE  FINANCIAL  FEASIBILITY    OF    THE    RAPID    TRANSIT    SYSTEMS 

DISCUSSED  IN  THIS  REPORT 


(1) 

Complete  Taylor 

Plan  of  1915 

(A) 

(2) 

Lines  now  au- 
thorized   by 
Councils,  and 

Delivery  Loop 

(B) 

(3) 

Lines  included 

in  Steps  1  and 

2  of  this 

report 

City's  estimated  investment  for  construction  of  lines- 
bonds - - 

$60,300,000 
30,268,300 

$48,400,000 
19,099,400 

$31,600,000 

Cumulative  deficit  in  City's  interest  and  sinlcing  fund 
charges  to  1940 

40,400 

Total  gross  cost  to  City  of  systems  as  of  1940 

$90,568,300 
12,220,000 

$67,499,400 
10,621,300 

$31,640,400 

Less  credit  due  to  sinking  fund    

8,495,900 

Net  cost  of  system  to  1940  (bond  and  deficit)--  -  _  —  _  - 

$78,348,300 

$56,878,100 

$23,144,500 

City's  cumulative  deficit  as  of  1930 

$20,770,400 
$2,240,200 
1943 

$13,907,200 
$1,676,300 
1942 

$4,191,400 

Maximum  deficit  in  any  one  year  — 

$815,200 

Year  in  which  deficit  disappears-.  -  .  . 

1930 

Company's  initial  investment  in  equipment 

Year  in  which  cumulative  deficit  is  wiped  out 

$15,206,000 
About  1962 

$10,487,000 
About  1962 

$6,961,000 
1940 

NOTE: — Entire  net  income  from  Camden  Tube  was  used  as  a  credit  in  Columns  1  and  2,  otherwise 
deficits  shown  would  be  greatly  increased.    Results  shown  in  Column  3  assume  Camden  Tube  as  not  built. 

This  table  shows  that,  owing  to  the  operation  of  the  provision  recommended  in  the  tentative  form  of 
lease  as  to  cmnulative  deficits  being  repaid  out  of  surplus  earnings  of  system,  there  will  be  no  surplus  to 
the  Company  until  near  the  expiration  of  the  50-year  lease— under  all  plans  except  those  herein  recom- 
mended, and  any  deficit  carried  over  would  probably  be  lost. 

(A)  The  figures  shown  in  this  column  refer  to  Plan  No.  16  of  the  1915  Annual  Report  and  do  not  include  line 

to  Byberry  or  Germanto^vn  Branch  of  Broad  Street  Subway. 

(B)  The  figures  in  this  column  refer  to  Plan  No.  8  of  1915  Annual  Report  and  do  not  include  the  German- 

town  Branch. 


28 


These  extensive  changes  in  the  construction  and  financial  plans  would  not  be  so  alarming 
were  it  not  for  the  fact  that  the  assumed  basis  upon  which  these  lines  can  be  leased  throws  a 
much  greater  burden  upon  the  City  than  was  contemplated  in  the  Report  of  1913,  upon  which 
the  City  originally  decided  to  act. 

The  Report  of  1913  shows  an  estimated  average  rate  of  return  on  the  entire  investment  in 
rapid  transit  lines  of  4.1  per  cent.,  but  these  figures  were  based  upon  the  assumptions  (a)  that 
the  exchange  tickets  would  not  be  disturbed,  (b)  that  transfers  to  the  rapid  transit  lines 
would  not  be  given  within  the  three-mile  limit,  (c)  that  the  present  system  would  not  be  re- 
imbursed for  losses  due  to  the  competition  of  the  rapid  transit  lines,  and  (d)  that  joint  revenue 
would  be  divided  on  a  passenger  mileage  basis. 

The  forms  of  lease  recommended  in  1914  and  in  1915  differ  radically  on  all  these  points, 
the  last  recommendations  assuming  that  the  exchange  tickets  will  be  wiped  out  and  the  Com- 
pany compensated  by  the  remittance  of  taxes  sufficient  to  partially  offset  the  loss.  Transfers 
are  to  be  granted  universally  between  surface  lines,  between  rapid  transit  lines,  and  between 
surface  and  rapid  transit  lines,  and  the  Company's  loss  through  competition  of  the  rapid  tran- 
sit lines  is  to  be  made  up  and  restored  to  them  to  a  limited  amount  from  the  net  earnings  of  the 
rapid  transit  system  before  any  payment  may  be  made  to  the  City  for  interest  and  sinking  fund 
charges. 

As  a  result  of  these  conditions  large  annual  deficits  are  estimated  to  accrue  in  the  City's 
interest  and  sinking  fund  account.  For  the  City  to  shoulder  these  annual  deficits,  caused  by 
a  deficient  net  income  from  the  unified  system,  means  a  considerable  increase  in  the  tax  rate. 
If  the  Company  shoulders  the  deficits,  as  was  substantially  the  case  in  Boston,  it  means  either 
an  increase  in  the  fare  or  the  alternative  of  bankruptcy.  Elsewhere  in  this  report  it  is  shown 
that  even  were  all  excess  of  capital  (commonly  called  "water")  eliminated  from  the  present 
system,  the  complete  unified  system  could  not  be  profitable  on  the  universal  5-cent  fare.  The 
experience  of  Boston  seems  to  prove  this  statement  conclusively. 

Taylor  Plans — Comparative  Merits  of  the  Former  Plans. 

An  opinion  may  be  given  here  as  to  the  comparative  merits  of  the  original  and  final  rec- 
ommendations from  the  City's  standpoint. 

Referring  first  to  the  original  recommendations  (Transit  Commissioner's  Report  of  1913) 
it  may  be  stated  that  the  general  location  of  the  routes  recommended  cannot  be  improved.  The 
location  and  routing  of  lines  in  the  business  district  is  not  perfect,  but  this  is  not  a  vital 
detail.  The  plan  of  financing  is  satisfactory,  but  the  form  of  lease  assumed  is  highly  improb- 
able, thereby  making  the  estimated  operating  results  untrustworthy  as  regards  the  City's  li- 
ability, and  the  financial  results  from  such  a  lease,  while  possibly  proper  from  a  promoter's 
point  of  view  and  so  compiled  as  to  put  the  undertaking  in  the  best  light,  do  not  show  the  actu- 
ally resulting  loss  of  revenue  from  the  City's  treasuiy. 

An  examination  of  the  1915  recommendations  shows  the  result  which  may  always  be  ex- 
pected where  a  private  gain  results  from  an  expenditure  of  the  people's  money.  Lines  have 
been  added  to  satisfy  the  demands  of  property  owners  and  others  interested  in  suburban  dis- 
tricts, that  the  City  shall  assist  to  develop  their  property,  and  the  City's  credit  has  been 
utilized  and  its  liability  increased  from  $35,000,000  to  over  $60,000,000. 

The  form  of  lease  assumed  is  much  more  practicable,  but  under  the  vast  expansion  recom- 
mended and  the  alterations  in  the  form  of  the  lease,  the  deficit  to  which  the  City  becomes  liable 
has  grown  enormously. 

3  29 


A  study  of  these  two  plans  is  very  instructive  since  it  shows  that  without  some  form  of 
check  by  which  the  burdens  which  the  City  assumes  in  such  an  improvement  can  be  at  least 
partially  transferred  to  the  parties  benefited,  there  is  no  limit  to  the  pressure  which  will  be 
put  upon  this  Department  and  City  Councils  for  the  development  of  what  are  now  suburban 
districts  of  the  city.  This  is  an  exceedingly  serious  phase,  and  that  it  is  not  imaginary  will 
be  seen  by  a  comparison  of  the  changes  in  recommendations  within  the  short  period  of  two 
years.     (See  Statements  1,  2,  and  3.) 

The  routes  for  rapid  transit  lines  and  financial  plans  outlined  in  the  original  report, 
with  the  exceptions  above  noted,  can  be  fully  endorsed.  The  technical  data  upon  which  those 
recommendations  were  made  are  full,  accurate  and  reliable,  and  these  same  data  when  applied 
to  the  recommendations  of  the  1915  report  show  that  extensions  into  suburban  territory  beyond 
what  was  originally  recommended  cannot  be  justified  on  economic  grounds. 

The  Taylor  Plan — Its  Ideals. 

This  report  must  be  considered  as  a  fourth  edition  of  the  "Taylor  Plan,"  for  while  not 
written  by  Mr.  Taylor,  it  is  written  by  an  engineer  upon  whom  his  mantle  has  fallen;  by  one 
who  is  in  full  sympathy  with  liim  and  who  has  the  same  ideals  in  view.  It  contains  the  same 
spirit  of  service  and  differs  from  former  editions  only  in  the  methods  as  to  how  the  ideals  shall 
be  attained. 

Underlying  this  and  the  former  reports  submitted  by  my  predecessor  upon  transit  devel- 
opment in  Philadelphia  is  an  ideal — A  Unified  Surface  and  Rapid  Transit  System  of  City 
Transportation  on  a  Five-cent  Fare  Basis,  popularly  expressed  in  the  slogan:  "One  City; 
One  System ;  One  Fare ; "  a  slogan  expressing  a  prophecy  and  a  hope ;  a  sentiment  with  a  main- 
spring of  service. 

It  is  an  ideal  difficult  of  attainment  containing  both  sentimental  and  commercial  elements. 

Its  realization  will  not  be  attained  unless  the  difficulties  are  understood  and  overcome. 

The  difficulties  in  the  way  of  the  unified  city  result  from  sectionalism.  This  is  a  psycho- 
logical element  in  the  ideal  which  will  not  be  discussed  in  this  report. 

The  difficulties  lying  in  the  way  of  a  unified  transportation  system  are  not  legal,  but 
financial ;  the  Contract  of  1907  encourages  and  provides  for  unified  operation. 

The  difficulties  of  operating  the  ideal  system  profitably  on  a  5-cent  fare  seem  at  present 
to  be  insurmountable.  "When  it  is  realized  that  the  present  system  can  barely  exist  on  the  fare 
which  during  1915  averaged  5.166  cents  per  revenue  passenger  it  is  difficult  to  see  how  the 
same  system  can  carry  a  large  additional  investment  when  that  investment  produces  no  notice- 
able increase  of  traffic  or  net  profits.     (See  Diagram  No.  6.) 

The  Taylor  Plan— General  Defects. 

The  recommendations  made  in  the  former  reports  are  now  realized  to  be  defective  along 
the  following  lines: 

1.  The  first  defect  is  that  they  do  not  contain  any  elements  or  features  which  would 
tend  to  regulate  or  control  the  demand  that  City  funds  be  expended  for  sectional  or  private 
advantage.  Without  some  form  of  control  there  will  be  no  limit  to  the  demands  for  these 
facilities.  The  experience  of  Boston  extending  over  a  period  of  twenty  years,  the  exper- 
ience of  New  York  over  a  period  of  more  than  ten  years,  and  the  sectional  attitude  already 
shown  here  in  the  last  two  years,  prove  that  without  some  form  of  control  by  which  the  bur- 

30 


den  resulting  from  unwarranted  expansion  is  placed  partially  upon  the  shoulders  of  those  bene- 
fited, the  ideal  aimed  at  can  never  be  attained. 

2.  The  second  defect  is  the  assumption  tliat  the  civic  and  social  benefits  resulting  from  the 
establishment  of  these  lines  on  a  5-cent  fare  will  warrant  the  resulting  burden  being  trans- 
ferred to  the  general  real  esta.te  taxes  of  the  City.  This  feature  is  discussed  at  length  elsewhere 
in  this  report. 

3.  The  third  defect  is  in  the  assumption  without  question  that  it  is  better  to  carry  the 
burden  by  a  resulting  property  tax  than  by  a  personal  tax  in  the  shape  of  an  adjustment  of 
the  car  fare  to  meet  the  burden. 

Concerning  these  points  this  report  is  intended  to  be  merely  suggestive  and  advisory. 

There  would  seem  to  be  fair  grounds  that  the  burden  might  be  equitably  divided,  that  the 
car  fare  might  be  adjusted  so  as  to  carry  a  portion  of  the  burden,  the  balance  being  placed 
upon  the  general  real  estate  of  the  city  or  carried  by  district  assessment. 

The  fact  that  an  ideal  is  difficult  to  attain  is  no  reason  why  that  ideal  should  be  aban- 
doned. I  am  heartily  in  favor  of  the  ideal,  and  this  report  is  aimed  to  make  such  suggestions 
as  I  believe  will  permit  the  attainment  of  as  close  an  approximation  to  it  as  is  now  practi- 
cable. 

The  Taylor  Plan — Suggestions  for  Attaining  the  Ideal. 

While  this  report  contains  a  number  of  suggestions,  which  may  or  may  not  be  regarded 
as  desirable  or  expedient  in  order  to  obtain  the  improved  rapid  transit  facilities,  which  are 
so  much  desired  by  all  citizens  of  Philadelphia,  it  makes  but  one  real  recommendation,  which  is : 

That  All  Citizens  Should 

(a)  Drop  personal  prejudice  in  connection  with  the  problem. 

(b)  Not  allow  any  sentimental  elements  to  obscure  the  practical  elements  of  the  problem. 

(c)  Show  a  spirit  to  consider  the  proposition  fairly  and  to  cheerfully  assume  burdens  in 
proportion  to  benefits. 

Loan  Bill  and  Ordinances  Under  Which  Construction  was  Authorized. 

The  Contract  of  1907  between  the  City  and  the  Philadelphia  Rapid  Transit  Comjiany  con- 
tained the  provision: 

"In  case  at  any  time  in  the  future  Councils  shall,  either  of  its  own  initiative  or  upon 
petition  of  any  of  the  citizens,  determine  that  new  lines  of  surface,  elevated  or  under- 
ground railway  should  be  constructed  within  the  city,  it  shall,  by  ordinance,  determine 
the  route  of  such  line,  and  the  terms  and  conditions  under  which  it  shall  be  built,  financed 
and  operated    *    *    *    " 

During  1915  a  loan  was  authorized  by  the  people  for  $6,000,000  toward  the  construction 
of  the  Prankford  Elevated  Railway  from  Front  and  Arch  Streets  to  Rhawn  Street,  and  the 
Broad  Street  Subway  from  League  Island  to  Olney  Avenue,  with  the  necessary  branch  lines 
northeast  and  northwest  from  Broad  Street. 

31 


Councils  passed  an  Ordinance,  approved  July  2,  1915,  defining  the  route  and  extent  of 
these  two  lines,  and  making  an  appropriation  of  $6,000,000  toward  their  construction.  The  or- 
dinance however  does  not  specify,  as  the  Contract  required,  who  shall  operate  these  lines  and 
upon  what  terms. 

In  both  lines  the  routes  specified  are  considerably  at  variance  with  the  recommendations 
of  the  former  Director. 

In  both  cases  the  routes  were  extended  far  beyond  the  limits  economically  warranted, 
thus  emphasizing  the  absolute  necessity  of  some  control  over  the  demand  that  City  funds  be 
expended  beyond  economic  limits  for  sectional  or  private  advantage.  , 

The  legal  terms  and  limitations  embodied  in  these  bills  may  conflict  with  the  economic  re-  I 
quirements,  but  this  report  does  not  intend  to  pass  on  this  point,  which  is  referred  to  the  Law 
Department  for  interpretation. 

Present  Situation  Complicated  by  Past  Mistakes. 

The  present  situation  in  the  transportation  problem  is  complicated  as  the  result  of  many 
errors  and  mistakes  made  by  legislators  in  the  past.  Probably  the  fundamental  mistake  was  in 
granting  to  the  original  passenger  railways  perpetual  franchises  for  the  use  of  the  City's  streets 
with  a  very  indefinite  provision  for  recapture  of  the  privileges.  Another  mistake  was  in  the  City's  '. 
requirement  of  an  excessive  franchise  tax  for  the  electrical  equipment  of  the  lines.  A  funda- 
mental mistake  was  in  not  recognizing  the  fact  that  city  transportation  is  essentially  a  monop- 
oly and  not  suitable  for  a  competitive  business. 

Besides  these  mistakes  on  the  City's  side,  which  are  more  or  less  evident  in  the  situation  to-  , 
day,  bad  judgment  in  financing  and  in  the  terms  of  consolidation  of  the  various  lines  have  pro-  | 
duced  a  burden  on  the  existing  system  wliich  it  is  difficult  to  eliminate  or  overcome. 

The  City's  Financial  Standing — Improvement  which  will  Result  if  the  Burden  be  Placed  Upon 
the  Car  Riders. 

The  legislation  permitting  the  City  to  increase  its  bonded  indebtedness  from  7  per  cent, 
to  10  per  cent,  of  the  assessed  valuation  of  real  and  personal  property  for  the  purpose  of  de- 
veloping its  port  and  rapid  transit  facilities  was  only  granted  upon  the  assumption  that  these 
facilities  would  be  in  part  at  least  self-supporting  and  not  result  in  a  large  increase  in  the  annual 
tax  rate.  It  was  supposed  that  although  the  City  would  be  the  legal  owner  of  any  structures 
built  from  the  proceeds  of  these  loans,  they  would  be  leased  or  operated  so  as  to  produce  sufficient 
income  to  make  the  project  self-supporting  and  not  be  an  additional  burden  upon  the  tax 
revenue. 

This  is  clearly  stated  in  the  law : 

"In  ascertaining  the  borrowing  capacity  of  said  City  of  Philadelphia  at  any  time  there 
shall  be  excluded  from  the  calculation  a  credit,  where  the  work  resulting  from  any  previous 
expenditure  for  any  one  or  more  of  the  specific  purposes  herein  above  enumerated  shall  be    | 
yielding  to  said  City  an  annual  current  net  revenue,  the  amount  of  which  credit  shall  be    I 
ascertained  by  capitalizing  the  annual  net  revenue  during  the  year  immediately  preceding 
the  time  of  such  ascertainment.     Such  capitalization  shall  be  accomplished  by  ascertaining    " 
the  principal  amount  which  would  yield  such  annual  current  net  revenue  at  the  average    i 
rate  of  interest  and  sinking  fund  charges,  payable  upon  the  indebtedness  incurred  by  said    ' 
City  for  such  purposes  up  to  the  time  of  such  ascertainment.    The  method  of  determining 
such  amount  so  to  be  excluded  or  allowed  as  a  credit  may  be  prescribed  by  the  General  As-  J 
sembly."  • 

32 


If  the  contract  under  wliich  these  City-built  lines  are  to  be  operated  shall  make  provision 
for  a  proper  fare  adjustment  so  that  the  enterprise  will  be  self-supporting  and  not  a  burden 
on  the  taxpayers  this  eniire  special  borroiving  capacity  amounting  to  about  $69,000,000  at  the 
present  time  will  he  free  as  far  as  any  transit  demands  are  concerned. 

This  fact  should  not  be  lightly  overlooked  as  it  greatly  increases  the  strength  of  the  City's 
financial  position. 

These  rapid  transit  lines  are  not  attractive  to  the  present  Company  simply  because  the 
nominal  5-cent  fare  will  not  produce  sufficient  revenue  to  permit  them  to  be  financed. 

If  the  fare  be  adjusted  the  City's  credit  need  not  be  utilized  at  all,  and  the  Frankford 
Elevated,  which  logically  should  be  a  part  of  the  Philadelphia  Rapid  Transit  Company  System 
and  not  the  City  System,  may  be  sold  by  the  City  to  them  at  cost  and  the  City  money  used  for 
subways  only.  In  the  original  "Taylor  Plan"  as  shown  elsewhere,  such  ownership  was  con- 
templated. 

Financing  of  the  Project. 

Under  all  plans  which  have  been  presented  to  date  the  funds  to  pay  for  construction  of 
the  entire  system,  except  equipment,  have  been  assumed  to  be  provided  by  the  sale  of  City 
bonds,  and  legislation  has  been  secured  permitting  the  City  to  increase  its  indebtedness  three 
per  cent,  and  to  issue  fifty-year  bonds  in  place  of  thirty-year  bonds  to  furnish  funds  for  the 
project. 

The  former  Director  of  this  Department  requested  that  a  loan  of  $50,000,000  be  authorized 
and  appropriated  for  the  construction  of  a  comprehensive  system,  outlined  in  the  1915  Annual 
Report  of  this  Department,  a  summary  of  which  is  given  elsewhere  in  this  report. 

The  recommendation  to  build  all  these  lines  now  or  presently  I  cannot  endorse  for  the  fol- 
lowing reasons: 

1.  I  regard  the  program  as  being  more  comprehensive  than  is  needed  to  meet  the  present 
demands  of  the  city  and  suggest  that  the  program  of  construction  be  broken  into  steps,  build- 
ing the  trunk  or  terminal  sections  and  the  most  urgently  needed  portions  of  the  lines  only,  dur- 
ing this  time  of  inflated  prices. 

2.  I  suggest  that  parts  of  the  system  for  later  construction,  described  elsewhere  in  this 
report,  be  so  financed  as  to  place  a  portion  at  least  of  the  resulting  burden  on  the  districts 
benefited — either  by  special  property  tax  or  by  personal  tax  (adjustment  of  car  fares).  (See 
Map  No.  5.) 

There  is  no  objection  to  the  loan  of  $50,000,000  being  authorized,  but  $35,000,000  only  is 
advised  herein,  this  being  a  matter  entirely  in  the  hands  of  Councils  and  the  citizens. 


33 


I 


THE  PRESENT  PLANS  FOR  RAPID  TRANSIT  DEVELOPMENT 


Definition  of  the  Taylor  Plans. 

It  is  unfortunate  that  there  exists  in  the  minds  of  the  public  a  somewhat  hazy  conception 
of  just  what  the  "Taylor  Plans"  comprehend,  and  an  assumption  that  they  are  al)Solutely  per- 
fect, and  if  altered  in  any  way  it  will  be  to  tlie  disadvantage  of  the  City.  As  stated  elsewhere, 
the  original  and  the  final  plans  differ  radically  at  many  points. 

The  final  and  official  "Taylor  Plans,"  as  they  appear  in  the  Annual  Report  of  the  De- 
partment of  City  Transit  for  1915,  are  as  follows: 

"1.     A  special   election  should  be  authorized  and  held  at  the  earliest  date  practica- 
ble for  the  purpose  of  authorizing  an  increase  in  the  City's  indebtedness  in  the  amount 
.    of  .$50,000,000  for  transit  development,  and  in  the  broadest  terms. 

"2.  Following  the  special  election,  appropriations  should  be  promptly  made  for  the 
completion  of  the  Broad  Street  Subway,  including  the  Delivery  Loop  and  elevated  branches, 
the  completion  of  the  Frankford  Elevated,  and  if  a  satisfactory  arrangement  be  not  com- 
pleted with  the  existing  system  for  the  operation  of  the  City-built  lines,  then  for  the  con- 
struction of  the  Chestnut  Street  Subway  to  connect  the  Frankford  Elevated  Line  with  the 
Woodland  Avenue  Elevated  Line  through  the  business  district; 

"3.  The  "Woodland  Avenue  (Darby)  Elevated  Line  should  be  constructed  promptly, 
connecting  with  the  Market  Street  Subway-Elevated  Line  near  Thirtieth  Street,  and 
should  be  operated  in  connection  with  the  Market  Street  Subway-Elevated  Line  so  long 
as  the  capacity  of  the  latter  will  permit. 

"4.  Upon  the  completion  of  a  satisfactoiy  arrangement  with  the  Philadelphia  Rapid 
Transit  Company,  the  Northwest  Subway-Elevated  Line  in  the  Parkway,  Twenty-ninth 
Street,  Henry  Avenue  and  Ridge  Avenue  should  be  undertaken. 

"5.  A  slight  change  should  be  made  in  the  alignment  of  the  Broad  Street  Subway 
as  before  recommended,  resulting  in  a  material  saving  in  cost  of  construction,  and  at  the 
same  time  leaving  adequate  space  for  additional  subway  between  Filbert  Street  and  Ridge 
Avenue  for  occupation  in  the  future  by  the  Pennsylvania  Railroad  Company,  or  such  other 
line  as  may  be  built. 

"6.  Every  effort  should  be  made  to  conclude  a  satisfactory  agreement  withthe  Phila- 
delphia Rapid  Transit  Company  before  any  expenditures  are  actually  made  on  the  Chest- 
nut Street  Subway,  which  will  be  essential  to  connect  up  the  two  aforesaid  elevated  lines 
for  independent  operation. 

"Prompt  action  is  necessary,  however,  as  the  Frankford  Elevated  will  soon  be  com- 
pleted and  must  not  be  permitted  to  stand  idle.  It  must,  therefoi-e,  be  furnished  with  ter- 
minal facilities  via  Market  Street  or  Chestnut  Street. 

"The  Department  has  carefully  worked  up  the  practical  details  to  be  embodied  in  the 
proposed  agreement  between  the  City  and  the  Company  in  a  manner  whereby  the  interests 
of  the  City  will  be  properly  protected  from  a  practical  standpoint. 

"The  legal  points  involved  should  be  given  careful  consideration  by  the  City  Solici- 
tor, and  the  document  should  be  carefully  gone  over  from  a  legal  standpoint. 

35 


"7.  The  City  should  secure  as  quickly  as  possible  all  the  real  estate  and  real  estate 
easements  necessary  for  the  lines  recommended,  including  the  Chestnut  Street  Subway.  The 
Chestnut  Street  Subway  will  be  needed  within  ten  years  in  order  to  relieve  Market  Street, 
whatever  the  method  of  operation  of  the  City-built  lines.  It  is  of  particular  importance 
that  such  real  estate  or  easements  be  secured  in  cases  where  buildings  are  likely  to  be 
erected  or  alterations  made  which  might  otherwise  add  to  the  cost  to  the  City.  All  loan 
authorizations  for  transit  development  should  be  in  such  terms  that  the  necessary  real  es- 
tate rights  can  be  obtained  thereunder  to  the  best  advantage. 

"8.  The  construction  of  a  high-speed  line  serving  the  Thirty-fifth  "Ward  and  con- 
necting with  the  Frankford  Elevated  should  be  undertaken  at  an  early  date,  and  proper 
arrangements  should  be  made  for  the  equipment  and  operation  thereof. 

"9.  The  bill  prepared  by  the  Department  providing  that  cars  should  be  through- 
routed  between  lines  built  and  owned  by  cities  of  the  first  class  and  lines  built  and  owned 
by  corporations  within  cities  of  the  first  class,  should  be  introduced  in  the  Legislature  at 
the  next  session. 

"The  enactment  of  this  bill  is  most  important." 

An  analysis  of  these  and  former  recommendations  shows  that  the  "Taylor  Plans"  really 
consist  of  four  elements: 

1.  A  comprehensive  program  of  construction  calling  for  the  expenditure  within  the  next 
three  years  of  a  sum  estimated  now  to  be  in  excess  of  $63,500,000  for  the  construction  of  the 
so-called  Delivery  Loop  and  lines  radiating  from  the  center  of  the  city  into  five  outlying  dis- 
tricts of  the  city. 

2.  A  financial  plan — using  the  City's  credit  upon  which  to  borrow  funds  for  construc- 
tion and  drawing  upon  the  City's  general  and  tax  revenues  for  payment  of  annual  deficits 
in  interest  and  .sinking  fund  requirements. 

3.  The  preparation  and  execution  of  a  lease  of  this  system  to  an  operating  company, 
which  it  is  expected  will  be  the  Philadelphia  Rapid  Transit  Company.  The  lines  recommended 
are  designed  with  that  end  in  view,  with  the  idea  of  opei-ating  the  surface  lines  and  the  City- 
built  lines  as  a  merged  system,  and  providing  for  a  free  interchange  between  the  systems  at 
all  points  of  intersection. 

4.  A  modification  of  the  "1907  Contract"  with  a  view  of  eliminating  the  8-cent  exchange 
tickets,  which  have  been  in  use  since  1895,  and  the  substitution  therefor  of  practically  a  uni- 
versal system  of  free  transfers  on  a  S-cent  fare.  This  last  element  may  be  considered  to  be 
somewhat  dependent  on,  or  a  factor  in,  the  third  element  and  is  fully  discussed  in  the  1915 
Report  of  this  Department. 

It  is  unfortunate  that  in  the  minds  of  many  people  this  last  element,  the  question  of  trans- 
fers, exchanges  and  fare  revision,  is  the  cardinal  feature  of  the  "Taylor  Plans."  The  pur- 
pose of  this  report  is  to  suggest  what  are  logical  improvements  in  certain  features  of  the  first 
and  second  elements,  namely  the  construction  and  financial  programs,  but  not  to  discuss  the 
third  and  fourth  elements  excepting  insofar  as  they  may  be  involved  in  the  modification  of 
the  construction  and  financial  programs. 

36 


Construction  Program  of  Taylor  Plan. 

An  examination  of  the  past  reports  of  this  Department  will  confirm  the  statement  that 
the  final  recommendation  is  an  evolution  from  the  original  recommendation  wliich  covered  only : 

(a)  The  building  by  the  Philadelphia  Rapid  Transit  Company  of  the  Frankford  Elevated 
Line  from  Front  and  Arch   Streets   to   Bridge  Street  in  Frankford. 

(b)  The  building  by  the  Philadelpliia  Rapid  Transit  Company  of  an  elevated  line  to  Darby, 
connecting  with  the  present  Market  Street  Elevated  Line  at  Thirtieth  and  Market  Streets. 

(c)  The  building  by  the  City  of  the  Broad  Street  Line  from  League  Island  to  Pike  Street, 
with  two  elevated  brandies  and  the  Delivery  Loop. 

The  estimated  investment  of  the  City  in  this  system  was  about  $35,000,000. 

In  the  original  report  the  Parkway  Line  was  not  considered,  or  recommended.  Owing, 
however,  to  the  insistent  demands  of  the  residents  in  the  northwestern  portion  of  tlie  city,  the 
Northwestern  Line  via  the  Parkway  and  Twenty-ninth  Street  was  added,  and  a  branch  from  the 
North  Broad  Street  Subway  was  projected  into  Germantown,  and  by  the  direction  of  Coun- 
cils (the  probable  result  of  local  demands)  the  extension  from  Bridge  Street  to  Rhawn  Street 
of  the  Frankford  Elevated  was  included.  A  high-speed  surface  line  on  private  right-of-way 
from  Bridge  Street  to  Byberry  was  finally  added,  and  changes  were  made  in  the  subway  por- 
tion of  Broad  Street  above  Pike  Street,  bringing  the  total  estimated  cost — using  the  former 
estimates — to  about  $62,000,000  for  the  entire  system.  Two  lines  only  have  been  authorized  by 
City  Councils  to  date  and  toward  their  construction  $6,000,000  has  been  appropriated,  leaving 
$56,000,000  as  the  estimated  cost  of  the  remainder  of  the  work,  based  upon  prices  ruling  at  the 
time  the  estimates  were  made. 

On  account  of  the  favorable  prices  obtained  on  the  contracts  let  during  1915,  which  aver- 
aged from  fifteen  to  twenty  per  cent,  below  the  estimated  cost,  the  Department  felt  safe  in 
assuming  that,  if  the  contracts  were  let  promptly  during  the  period  of  low  prices,  the  sum  of 
$50,000,000  would  probably  complete  the  entire  program,  and  this  amount  was  accordingly  re- 
quested for  the  construction  program. 

It  is  very  unfortunate  for  the  City  that  the  low  prices  heretofore  prevailing  are  no  longer 
available — a  sharp  rise  in  all  building  material  and  labor  having  taken  place  in  the  last  few 
months.  Prices  are  now  twenty  to  fifty  per  cent,  above  those  existing  a  year  ago,  and  as  a  busi- 
ness proposition,  ignoring  the  political  and  sentimental  aspects  of  the  program,  I  think  the 
City  would  be  exceedingly  unwise  to  construct  as  one  unit  or  step  at  this  time  such  a  compre- 
liensive  construction  program,  which  cannot  be  justified  for  traffic  or  business  reasons,  and 
which  will  have  capacity  years  in  advance  of  tlie  needs  of  the  city. 

In  a  program  of  this  magnitude,  running  over  a  construction  period  of  at  least  three  years, 
a  contractor  is  bound  to  protect  himself,  and  owing  to  the  European  war  no  one  can  safely  pre- 
dict the  course  of  prices  tliree  years  in  advance. 

This  is  only  one  of  the  many  reasons  for  advocating  tliat  the  final  progi-am,  which  is  in- 
tended to  take  care  of  Philadelphia's  transportation  needs  for  a  period  of  thirty  to  fifty  years, 
should  be  broken  into  steps. 

Objections  to  the  Construction  Program  of  the  Taylor  Plan. 

My  objections  to  the  construction  program  are : 

1.  It  is  a  much  too  comprehensive  system  of  construction  for  the  City  to  attempt  to  digest 
in  such  a  limited  period  as  three  years.    It  was  born  of  an  optimism  concerning  the  growth  of 

37 


Philadelphia  which  is  not  warranted  by  the  existing  conditions  or  statistics.  It  is  intended 
to  take  care  of  the  rapid  transit  needs  of  the  City  of  Philadelphia  when  the  population  reaches 
3,000,000.  It  is  not  a  good  business  venture  to  construct  such  lines  so  far  in  advance  of  their 
need,  as  no  man  can  safely  predict  the  direction  of  growth  in  the  city  in  the  next  two  or  three 
generations.  I  believe  in  designing  the  system  with  a  proper  amount  of  foresight,  and  in  mak- 
ing provision  for  the  future  in  a  manner  which  seems  to  be  in  accordance  with  the  probable 
needs  as  measured  by  the  city's  characteristics  of  growth  and  past  history.  I  earnestly  wish  to 
see  Philadelphia  profit  by  the  errors  and  mistakes  made  by  other  cities,  and  not  spend  money 
recklessly  and  without  regard  to  the  carrying  charges,  simply  because  the  City  has  sufficient 
borrowing  capacit.y  available. 

2.  I  do  not  advocate  the  City  going  into  or  committing  itself  to  an  extensive  construction 
program  in  advance  of  the  question  of  operation  of  the  lines  being  definitely  settled;  in 
other  words,  until  it  is  definitely  known  whether  these  lines  will  be  operated  by  the  Phila- 
delphia Rapid  Transit  Company  or  by  an  independent  operator.  This  question  is  a  vital 
one,  and  the  commercial  success  of  the  system  depends  largely  on  the  method  of  operation  and 
the  terms  of  the  lease.  The  discussion  of  this  matter  elsewhere  should  make  clear  my  conten- 
tion that  this  question  of  the  lease  should  l)e  definitely  settled  before  the  City  commits  itself 
to  a  program  affecting  its  welfare  for  generations  to  come. 

3.  To  carry  out  this  construction  program  at  the  present  time,  in  this  era  of  high  prices, 
will  doubtless  nearly — if  not  entirely — exhaust  the  City's  credit.  It  may  be  a  good  political 
move  to  do  this,  but  in  my  judgment  it  is  not  good  business,  and  my  observation  has  been  that 
any  political  position  not  founded  on  a  sound  basis  is  an  error  in  the  long  run.  Political 
theories  are  often  wrecked  by  economic  facts.  The  citizens  as  a  whole  should  realize  that  any 
warranted  improvement  benefiting  one  part  of  the  city  reacts  beneficially  on  the  entire  city. 

This  report  should  make  it  plain  that  the  City  contemplates  the  gradual  building  of  a  com- 
prehensive system  which  will  fully  serve  the  needs  of  the  entire  city. 

The  Proposed  Operating  Lease  of  City-Built  Lines. 

Regarding  the  second  element  of  the  "Taylor  Plans,"  namely  the  operating  lease,  I  may 
state  that  the  vital  importance  of  securing  an  operator  of  the  City-built  lines  on  terms  satisfac- 
tory to  the  City,  was  early  recognized  and  a  suggested  form  of  lease,  following  the  general  lines 
used  with  the  "dual  subway"  contracts  in  New  York  City,  was  submitted  by  the  Director  of 
this  Department  to  the  conti'olling  officials  of  the  Philadelphia  Rapid  Transit  Company. 

Nearly  two  years  have  elapsed  since  these  officials  signified  their  willingness  to  make  such 
a  lease,  but  inasmuch  as  the  tentative  draft  contained  provisions  for  protecting  the  Company 
against  part  of  the  losses  through  biTsiness  diverted  to  the  City's  system,  the  Department  felt 
that  it  should  have  a  reciprocal  protection  and  insisted  that  the  Union  Traction  Company,  the 
principal  underlying  subsidiary  of  the  Philadelphia  Rapid  Transit  Company,  should  become 
jointly  responsible  with  the  Philadelphia  Rapid  Transit  Company,  or  in  other  words,  the  en- 
dorser of  the  lease.  Up  to  the  present  time  the  Union  Traction  Company  has  not  signified  its 
intention  to  participate  in  the  negotiations. 

The  Department  believes,  in  view  of  the  financial  history  of  the  Philadelphia  Rapid  Tran- 
sit Company,  that  the  City's  position  in  this  matter  is  entirely  reasonable  and  proper — simply 
business  precaution.  ^ 

Any  form  of  operating  lease  which  acts  so  as  to  protect  the  Philadelphia  Rapid  Transit 

38 


Company  also  adds  additional  security  to  the  subsidiary  company  and  consequently  increases 
the  stability  of  the  subsidiary. 

It  has  been  assumed  in  all  the  recommendations  and  discussions  made  by  this  Department 
to  date,  that  eventually  an  agreement  will  be  reached  with  the  Philadelphia  Rapid  Transit 
Company  by  which  they  will  become  the  operator  of  the  City  built  lines  and  that  the  present 
surface  and  subway-elevated  system  would  be  operated  jointly  with  the  City-built  lines. 

For  reasons  given  elsewhere  in  this  report  I  strongly  urge  that  no  large  amount  of  con- 
struction work — at  least  no  work  beyond  the  first  and  second  steps  described  elsewhere  in  this 
report— be  done  pending  the  execution  of  a  lease. 

It  is  vitally  important  that  the  question  should  be  settled  as  to  who  is  to  operate  this  system, 
and  upon  what  terms,  and  what  routes  are  to  be  involved,  in  order  to  determine  the  financial 
results  to  both  the  City  and  the  lessee. 

This  report  suggests  that  certain  lines  enumerated  on  Statement  2  of  this  report  forming  the 
central  or  terminal  and  trunk  portions  of  the  comprehensive  system  be  constructed  in  steps  as 
needed  and  financed  out  of  funds  provided  from  the  sale  of  City  bonds. 

All  extensions  into  outlying  and  suburban  territory  connecting  with  this  central  system 
are  suggested  for  construction  when,  if,  and  a.s  ordered  by  Councils,  after  the  enactment  of 
new  legislation  enabling  the  City  to  assess  the  cost  of  these  local  branches  upon  the  property 
of  the  district  benefited.  A  full  discussion  of  this  appears  elsewhere  in  this  report ;  also  full  dis- 
cussion is  given  in  regard  to  the  deficits  which  will  result  from  the  operation  of  this  system, 
under  different  methods  of  operation  and  how  they  are  to  be  met. 

The  Contract  between  the  City  and  the  Philadelphia  Rapid  Transit  Company,  popularly 
known  as  the  "1907  Contract,"  contains  a  third  clause,  reading  as  follows: 

"In  case  at  any  time  in  the  future  Councils  shall,  either  of  its  own  initiative  or  upon 
petition  of  any  of  the  citizens,  determine  that  new  lines  of  surface,  elevated  or  underground 
railway  should  be  constructed  within  the  City,  it  shall,  by  ordinance,  determine  the  route 
of  such  line,  and  the  terms  and  conditions  under  which  it  shall  be  built,  financed  and  op- 
erated and  the  Company  shall  have  ninety  (90)  days  after  the  passage  of  such  ordinance 
to  take  such  corporate  action  as  may  be  necessary  to  accept  the  same,  certified  copies  of  which 
action  shall  be  duly  filed  with  the  Mayor  within  said  period  of  ninety  (90)  days;  but  if  the 
Company  shall  fail  to  accept  said  plan  within  said  period  of  ninety  (90)  days,  or  shall 
reject  the  same  within  said  time  or,  after  accepting  the  same,  shall  fail  to  enter  upon  the 
work  in  good  faith  and  prosecute  the  same  as  required  in  such  ordinance,  then  the  City  may 
offer  the  right  to  construct  and  operate  said  road  under  said  terms  and  conditions  to  such 
other  persons,  company  or  corporation  as  may  be  willing  to  undertake  the  same :  Provided, 
However,  That  an.y  rights  acquired  by  the  Company  under  this  section,  and  the  section 
immediately  preceding,  shall  be  subject  to  all  the  terms  and  conditions  of  this  contract  with 
respect  to  a  voice  in  the  management,  supervision  of  accounts,  division  of  profits  after  the 
return  of  six  (6)  per  cent,  upon  the  capital  invested,  and  the  right  to  ultimately  acquire  all 
the  interest  of  the  Company  at  the  expiration  of  fifty  (50)  years  from  the  date  of  this  eon- 
tract:  And,  Provided  Further,  That  in  the  ease  of  the  construction  of  new  lines  the  cap- 
ital necessary  therefor  shall,  as  far  as  practicable,  be  raised  upon  bond  issues  bearing  the 
guarantee  of  the  Compan.y  as  to  principal  and  interest,  which  bonds  shall  be  issued  in 
denominations  of  one  hundred  (100)  dollars,  five  hundred  (500)  dollars,  and  one  thousand 
(1,000)  dollars,  and  be  offered  to  public  subscription,  but  in  no  case  shall  they  be  sold  tor 
less  than  par;  and  to  siyh  extent  as  it  may  be  impracticable  to  finance  new  enterprises  upon 
bonds,  or  in  ease  additional  capital  is  needed  for  the  purpose  of  extensions,  additions  and 

39 


betterments  to  existing  lines,  power  or  equipment,  the  same  may  be  raised  by  an  increase  in 
the  capital  stock  of  the  Company,  but  only  with  the  express  consent  of  the  City,  and  all 
such  increases  shall  be  fi^ll  paid  at  par  in  cash,  and  be  subject  to  all  the  provisions  herein 
contained  with  respect  to  the  original  thirty  million  (30,000,000)  dollars  of  capital  stock 
of  the  Company." 

On  July  2,  1915,  an  ordinance  passed  by  Councils  was  approved  by  the  Mayor,  authorizing 
the  construction  of  the  Frankford  and  Broad  Street  rapid  transit  lines,  and  $6,000,000  has 
been  appropriated  toward  their  construction.  This  clause  distinctly  states  that  Councils  shall 
"by  Ordinance  determine  the  route  of  said  such  line  and  the  terms  and  conditions  under 
which  it  shall  be  built,  financed  and  operated."  The  above  ordinance  determines  the  route,  and 
partially  sets  forth  the  terms  and  conditions  under  which  it  shall  be  financed,  but  is  absolutely 
silent  as  to  the  operation  of  the  road.  Up  to  date  the  Rapid  Transit  Company  has  shown  no 
desire  to  operate  these  lines  as  is  evidenced  by  the  fact  that  they  have  not  notified  the  City  of 
their  desire  to  submit  a  proposition  for  the  operation  of  these  lines.  The  City  is  therefore 
legally  free  to  negotiate  with  other  parties  as  to  terms  for  the  operation  of  these  two  routes. 

The  wording  of  the  "1907  Contract"  apparently  contemplates  separate  and  independent 
contracts  for  each  of  the  lines  authorized.  The  contract  evidently  did  not  contemplate  an  ex- 
tensive and  compi-ehonsive  system  as  contemplated  and  recommended  in  the  complete  "Taylor 
Plans."  The  Contract  clearly  recognized  that  the  building,  financing  and  operating  were  inter- 
dependent and  so  linked  together  that  one  element  cannot  be  disregarded  without  nullifying  the 
intent  of  the  Contract.  This  emphasizes  again  the  absolute  need  of  settling  the  question  of 
who  is  to  operate  these  lines  before  the  construction  is  undertaken — to  determine  in  advance 
whether  this  is  to  be  a  part  of  the  unified  system  or  supplementary  to  the  existing  system,  or 
to  operate  independently  as  a  direct  competitor  of  the  existing  system.  If  this  be  not  determined 
in  advance  of  construction,  the  City  may  be  placed  in  the  position  of  hanging  on  a  completed 
subway  a  sign  frequently  seen,  "This  building  for  rent — will  be  altered  as  required  to  suit 
tenant."  That  this  is  not  a  groundless  fear  is  sho^^•n  by  the  fact  that  New  York  City,  after  the 
completion  of  the  first  subway,  now  12  years  ago,  designed  a  comprehensive  system  of  subways 
knowTi  as  Tri-Borough  Route,  and  started  on  its  consti'uction  hastily  and  without  any  knowl- 
edge or  certainty  by  whom  the  system  would  be  operated.  Parts  of  this  system,  representing 
many  millions  of  dollars,  were  completed  and  lay  idle  for  several  years;  upon  the  final  ex- 
ecution of  the  lease  the  system  was  divided  between  two  operating  companies  and  some  work 
which  had  been  done  on  abandoned  routes  was  lost.  Owing  to  the  confusion  which  resulted 
from  the  delay  in  changing  routes  the  City  has  lost  a  large  amount  of  money  and  interest 
charges  on  completed  sections  of  the  route  which  had  been  standing  idle  and  unused  for  many 
months.  It  is  largely  to  avoid  such  errors  and  to  save  the  City  from  financial  loss  that  I  urge 
and  insist  that  the  question  of  operation  be  settled  in  advance  of  any  large  amount  of  con- 
struction and  the  form  of  lease  determined  so  that  the  system,  when  built,  will  be  in  accordance 
with  the  lease  and  conform  as  nearly  as  possible  to  the  compromised  wishes  of  the  City  and  the 
operator. 

The  preparation  and  negotiation  of  a  lease  of  this  character  for  a  long  period,  involving 
not  only  the  liability  for  large  sums  upon  the  City's  side,  but  the  welfare  of  a  large  transpor- 
tation company  as  well,  involves  a  serious  responsibility  and  will  require  the  best  legal  and 
technical  talent  available,  as  will  appear  from  a  study  of  what  possibilities  are  involved  in  this, 
the  most  vital  feature  of  the  entire  undertaking. 

In  the  determination  of  what  is  just  and  equitable  there  is  much  room  for  honest  differ- 
ence of  opinion  and  the  City  must  be  very  careful  to  avoid  making  an  unwise   contract,   as 

40 


many  now  claim  was  done  when  the  "Contract  of  1907"  was  executed  between  the  City  and  the 
Philadelphia  Rapid  Transit  Company. 

Owing  to  the  urgency  of  the  situation  the  City  should  promptly  arrange  for  the  renewal 
of  negotiations  with  the  Philadelphia  Rapid  Transit  Company,  and  secure  from  them  a  definite 
expression  as  to  their  willingness  and  ability  to  presently  agree  upon  and  execute  a  satisfactory 
lease;  otherwise  the  City  must  look  for  an  independent  operator. 

It  will  be  necessary  to  modify  some  features  of  the  contemplated  program  if  the  lines  are 
to  be  leased  to  an  operator  independent  of  the  Philadelphia  Rapid  Transit  Company.  (See 
Map  No.  1.) 

Should  negotiations  for  a  lease  with  the  Philadelphia  Rapid  Transit  Company  fail,  the 
City  should  at  once  formulate  terms  under  which  it  is  willing  to  lease  to  an  independent' opera- 
tor and  advertise  these  conditions  so  that  bids  can  be  secured. 

The  proposals  up  to  date  have  been  presented  by  the  City  to  the  Philadelphia  Rapid  Tran- 
sit Company.  The  Philadelphia  Rapid  Transit  Company  has  made  but  one  counter-proposal, 
dated  March  25,  1914,  and  later  all  negotiations  were  broken  off  by  the  Company. 

An  earnest  effort  to  cooperate  must  be  made  by  the  Philadelphia  Rapid  Transit  Company 
and  by  the  Union  Traction  Company,  its  subsidiary,  if  this  lease  is  to  become  a  fact. 

In  the  New  York  situation  the  first  contract,  involving  about  $39,000,000  for  construction, 
carried  with  it  a  fifty  year  operating  lease  of  the  system. 

It  is  not  likely  that  the  City  of  Philadelphia  could  carry  out  its  program  on  such  lines, 
as  conditions  here  are  radically  dift'erent  from  those  which  existed  in  New  York  sixteen  years 
ago. 

Transfers  Between  Lines. 

As  stated  in  the  discussion  of  the  financial  results  from  the  system,  it  has  been  assumed  in 
making  up  those  figures  that  the  lease  just  mentioned  will  provide  that  the  present  and  the  new 
City-built  systems  be  operated  as  a  unified  system  and  that  practically  universal  free  trans- 
fers will  be  available  on  a  5-cent  fare  basis. 

In  this  respect  this  report  does  not  differ  from  all  that  have  preceded  it.  It  is  strictly 
necessary  in  making  comparative  estimates  to  use  the  same  data  in  all  cases  and  this  has  been 
done  in  figuring  the  financial  results. 

This  is  not  to  be  taken  as  either  an  endorsement  or  disapproval  of  this  feature  of  the  former 
plans.  The  policy  as  to  transfers  involves  the  plan  of  financing  the  undertaking,  the  lease  of 
the  system  and  other  features  discussed  in  this  report. 

The  Department  now  feels  that  this  matter  of  transfers  should  be  left  to  be  worked  out  in 
connection  with  the  financial  plans  and  the  operating  lease,  which  must  be  finally  pa.ssed  on  by 
Councils  and  tlie  Public  Service  Commission. 

This  element  is  only  brought  into  the  situation  on  tlie  assumption  that  the  Philadelphia 
Rapid  Transit  Company  will  be  the  eventual  lessee  and  operator  of  the  municipal  rapid 
transit  lines. 

Should  these  lines  be  leased  to  an  independent  operator  the  two  systems  may  be  operated 
independently  and  the  same  condition  will  then  prevail  as  now  exists  in  New  York  City,  under 
what  is  known  as  the  "dual  subway  system." 

This  report  contemplates  the  same  transferring  arrangement  between  lines  as  were  as- 
sumed possible  and  desirable  under  the  former  plans,  and  all  statements  of  earnings  are 
comparable. 

Elsewhere  the  effect  of  the  changes  recommended  is  considered,  (a)  as  to  the  financing  of 
deficits,  and  (b)  as  to  the  financing  of  suburban  extensions. 

41 


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43 


GENERAL  DISCUSSION   OF  RAPID  TRANSIT  LINES 


Advantages  of  Rapid  Transit  Lines. 

The  demand  for  rapid  transit  facilities  in  Philadelphia  is  partly  the  result  of  irritation 
over  the  fare  question  and  partly  the  result  of  a  real  need  for  such  facilities  which  exists  in 
certain  sections  of  the  city.  The  residential  section  of  the  city  has  expanded  in  area  until  the 
service  of  the  present  surface  system  is  no  longer  adequate. 

The  average  citizen  has  come  to  feel  that  not  more  than  30  minutes  should  be  spent  in  trav- 
eling from  his  home  to  his  business,  and  probably,  due  to  the  socialistic  ideas  now  prevalent, 
he  has  come  to  believe  that  if  the  present  Company  cannot  supply  these  facilities,  the  City 
should  supply  them.  He  regards  this  as  a  proper  field  for  municipal  endeavor,  and  does  not 
realize  the  magnitude  of  the  problem  or  the  burdens  which  it  involves. 

Rapid  transit  lines  are  simply  a  development  of  city  passenger  transportation  from  sur- 
face lines,  and  their  function  should  be  to  extend  the  usefulness  of  those  lines  and  not  to 
compete  with  them. 

The  two  advantages  possessed  by  rapid  transit  lines  over  the  surface  cars  lie  in  their 
higher  speed  and  larger  capacity. 

The  higher  speed  results  from  their  being  free  from  interference  with  other  traffic.  The 
speed  of  the  lines  is  a  direct  function  of  the  number  of  stops  per  mile.  With  ten  stops  per 
mile  the  schedule  speed  would  vary  but  little  from  that  of  the  present  surface  cars.  With  two 
stops  per  mile  a  schedule  speed  of  16  to  17  miles  per  hour  is  entirely  feasible.  With  one  stop 
in  two  miles  or  over,  a  schedule  speed  of  25  miles  per  hour  or  higher  may  be  attained. 

The  capacity  of  the  lines  is  a  direct  function  of  the  length  of  the  trains  and  their  fre- 
quency. 

Results  Due  to  Location  and  Routing. 

In  all  plans  for  rapid  transit  in  Philadelphia  will  be  found  the  feature  that  each  is  so  de- 
signed as  to  supplement  the  existing  transit  facilities — not  to  act  primarily  as  a  competitor, 
although  they  must  so  act  to  some  extent  in  the  districts  through  which  they  operate. 

The  lines  have  been  so  located  as  to  shorten  the  time  of  travel  between  the  residential 
and  business  districts  of  the  city,  and  hence  are  located  on  as  nearly  radial  lines  as  the  street 
formation  of  the  city  permits.  Since  it  has  been  found  that  a  rapid  transit  line  without  feeders 
does  not  draw  patronage  from  the  territory  through  which  it  runs,  to  a  greater  distance  than 
one-half  mile  on  each  side  of  the  line,  the  natural  inference  is  that  such  lines  should  be  not 
more  than  one  mile  apart,  and  the  recommendations  in  the  Transit  Commissioner's  Report  of 
1913  are  based  on  this  spacing.  This  Report  clear] j^  indicates  also  the  great  advantages  result- 
ing to  the  citizens  from  the  utilization  of  the  present  surface  lines  as  feeders  to  these  lines,  it 
being  assumed  that  the  two  systems  can  be  operated  as  a  merged  or  joint  system.  This  Report 
also  clearly  shows  that  the  advantages  from  rapid  transit  lines  will  largely  accrue  to  the  busi- 
ness district  and  to  the  riders  from,  and  owners  of  land  in,  the  district  lying  beyond  a  radius  of 
four  miles  from  the  business  center  of  the  city. 

This  system  is  not  intended  principally  for  the  city  of  to-day — which  lies  mostly  within 
the  four-mile  circle — but  for  the  suburbs  of  to-day,  the  city  of  the  future,  the  city  of  a  million 
or  more  people  who  fifty  years  hence  will  reside  in  this  area  beyond  the  four-mile  circle. 

4  45 


The  comprehensive  system  of  new  lines  now  planned  will  mean  a  per  capita  investment  of 
about  $40,  based  on  the  entire  present  population ;  but  $120  or  more,  based  on  the  population 
chiefly  benefited  (suburban). 

The  chief  advantage  to  the  patrons  of  this  transportation  system  lies  in  the  reduction  of  the 
time  needed  to  travel  from  their  homes  to  the  business  center  or  their  work.  This  is  recognized 
as  desirable — as  tending  to  a  better  standard  of  living  conditions,  but  in  few  cases  can  any 
money  value  be  assigned  to  this  advantage,  as  the  saving  is  not  in  commercial  or  salable  time, 
nor  does  it  add  to  the  rider's  daily  cash  income.  A  fraction  of  the  time  now  used  in  traveling 
will  be  diverted  by  the  riders  to  other  uses,  mostly  non-commercial — non-producing. 

Tlie  chief  financial  beneficiaries  of  these  new  lines  will  be  the  real  estate  owners,  operators 
and  builders,  in  territory  tributary  to  the  lines,  since,  owing  to  the  higher  speed  of  these  lines, 
land  lying  considerably  more  distant  from  the  business  district  of  the  city  than  the  present 
residential  district  is  brought  witliin  the  same  time  limit. 

The  direct  result  of  this  can  be  shown  to  be  a  shifting  of  the  population  and  an  increase 
of  the  residential  area  outside  of  satisfactory  surface  car  limits,  increasing  the  average  length 
of  passenger  haul.  The  rider  in  many  cases  simply  moves  out  on  the  new  lines  until  his  travel- 
ing time  becomes  approximately  what  it  is  on  the  present  system.  It  is  greatly  to  be  regretted 
that  imder  present  laws  it  is  impossible  to  assess  any  of  the  cost  of  construction  of  such  a  sys- 
tem upon  the  property  benefited.  It  is  entirely  a  fallacy  to  assume  that  the  increased  revenue 
from  increase  of  general  taxation  di;e  to  such  development  will  recompense  the  City  for  its 
transit  development,  as  there  is  no  such  surplus  tax  income  resulting. 

The  Broad  Stireet  Line  and  Loop. 

The  fundamental  idea  underlying  the  location  of  the  Broad  Street  Subway  was  to  utilize 
the  main  thoroughfare  of  the  city  ruuning  north  and  south  to  provide  rapid  transit  in  a  north 
and  south  direction  equivalent  to  that  provided  on  Market  Street  in  an  east  and  west  direction. 
It  is  well  recognized  that  while  Broad  Street  is  the  main  north  and  south  thoroughfare  of  the 
city  it  has  never  developed  as  a  business  street  to  the  extent  that  its  central  position  would 
warrant.  The  larger  trading  establishments  of  the  city  are  located  along  the  east  and  west 
streets  of  the  business  district,  principally  east  of  Broad  Street,  and  it  was  early  found  from  the 
traffic  investigation  that  a  rapid  ti-ansit  line  serving  Broad  Street  only  would  be  undesirable,  as 
the  destination  of  about  sixty  per  cent,  of  the  patrons  of  this  line  was  in  the  territory  east  of 
Broad  Street.  This  would  have  brought  about  a  wholesale  transferring  of  the  passengers  either 
to  the  Market  Street  Line  at  City  Hall  Station,  or  to  the  surface  lines  to  an  extent  that 
could  be  provided  for  only  with  great  difficulty.  It  was,  therefore,  realized  that  it  was  abso- 
lutely essential  to  carry  part  of  this  traffic  directly  into  this  eastern  business  district  without 
transferring.  A  large  number  of  studies  were  made  and  routes  suggested  and  tried  out.  The 
so-called  "loop"  as  finally  decided  upon  and  recommended  in  the  original  report  of  1913  was 
the  result  of  a  compromise,  and  it  is  not  necessary  at  this  time  to  go  into  the  reasons  which 
forced  or  brought  about  its  adoption.  Some  of  the  princii^al  reasons  have  been  given  in  for- 
mer reports  of  this  Department. 

Objections  to  Loop. 

My  objections  to  the  "loop"  plan  are  based  chiefly  on  its  objectionably  high  cost  for  the 
service  of  one  line  only,  as  the  Parkway  Line  which  is  to  be  connected  to  the  "loop"  in  the  City 
Hall  Station  cannot  be  operated  on  the  "loop"  when  the  Broad  Street  Lines  reach  full  capa- 
city, and  its  construction  and  operation  violates  Nos.  3  and  6  of  the  principles  formulated  on 

46 


'  This  large  loop  recommended  in  Taylor  Plans  has  the  disadvantage  or  requring  about 
two  miles  of  very  expensive  construction  in  order  to  serve  three  important  stations  only. 
From  North  Broad  Street  Subway  the  distribution  of  passengers  at  the  different  stations 
on  the  "loop"  will  be  as  follows: 

To  East  and  West  Legs  of  the  Loop 

City  Hall  Station 28.1% 

Chestnut  Station 13.3% 

Eighth  and  Market  Station 33.6% 

75.0% 
To  North  and  South  Legs  of  the  loop: 

Twelfth  and  Locust  Station 2.4%  I 

Tenth  and  Locust  Station 3.0%  I 

Tenth  and  Arch  Station 9.4%  ■i 

Twelfth  and  Arch  Station 10.2%  B 

25.0%  ^HH 

Locust  and  Arch  Street  legs  inactive  -  This  makes  clear  the  reason  for  recommending 
the  modified  plan  by  which  the  8th  Street  District  is  reached  by  the  shortest  route 
via  Ridge  Ave.  and  for  using  Walnut  Street 


28.17. 


I 


13.3 


'S''"    ARCH  ST       Si'° 


IZ^*^St.5tdtion 


I0''"5t.  Station 


C\\y  Hall  Station 


^<S^ 


U^ 


Market  5t  Station 


Chestnut  St  Station 


12  "^"51  Station 


I 

X 
X 

id 


33.e°/o 


lO^^StStation 


Ij.  LOCUST  5T  l.^^ 


DIAGRAM  SHOWING 

PERCENTAGE  DISTRIBUTION  OF  NORTH  BROAD  ST 

PAS5EMGtR50NBOUlSD)AT  DELIVERY  LOOP  STATIONSJAYLOR  PLANS 


DIAGRAM  NO.  I 


page  12.     The  "loop"  feature,  as  planned,  repreisents  an  outlay  for  the  terminal  of  the  Broad 
Street  Lines  of  from  25  to  30  per  cent,  of  the  total  outlay. 

The  "loop"  is  in  reality  a  form  of  "stub-terminal"  for  the  North  Broad  Street  trains  with 
provision  for  through-routing  North  and  South  Broad  Street  trains  on  either  side  of  the 
"loop,"  thus  introducing  much  complication.  The  large  loop  recommended  with  seven  stations 
located  thereon,  has  the  disadvantage  of  requiring  about  two  miles  of  very  expensive  construc- 
tion in  order  to  serve  three  important  stations  only.  The  trafSc  figures  in  this  Department  esti- 
mate that  the  distribution  of  passengers  at  the  different  stations  on  the  "loop"  will  be  as  fol- 
lows : 

From  North  Broad  Street: 

To  East  and  "West  Legs  of  the  Loop : 

City   Hall    Station 28.1% 

Chestnut   Station    13.3% 

Eighth  and  Market  Station 33.6%     75.0% 

To  North  and  South  Legs  of  the  Loop : 

Twelfth  and  Locust  Station 2.4% 

Tenth  and  Locust  Station 3.0% 

Tenth  and  Arch  Station 9.4% 

Twelfth  and  Arch  Station 10.2%     25.0%. 

100.0% 

These  figures  show  that  the  Arch  Street  and  Locust  Street  legs  of  the  ' '  loop ' '  are  inactive 
— about  seventy-five  per  cent,  of  the  total  business  being  done  on  the  Broad  Street  and  Eighth 
Street  legs.  This  makes  clear  the  reason  for  recommending  the  modified  plan  by  which  the 
Eighth  Street  district  is  reached  by  the  shortest  route  (via  Ridge  Avenue)  and  for  using  Wal- 
nut Street  instead  of  Locust  Street  as  a  suitable  connection  for  tlie  Parkway  Line  in  accord- 
ance with  principles  laid  do\\Ti.  The  stations  on  the  modified  routes  will  be  located  so  as  to 
adequately  provide  for  the  traffic  as  estimated  above.     (See  Map  No.  2.) 

These  figures  also  make  clear  the  great  amoimt  of  congestion  which  will  be  produced  at 
Eighth  and  Market  Streets  and  at  the  Broad  Street  Stations  near  City  Hall.  They  emphasize 
the  necessity  for  a  wider  street  at  P^ighth  Street,  especially  more  sidewalk  width  and  show  the 
great  desirability  of  separating  the  City  Hall  and  Chestnut  Street  Stations  as  this  plan  con- 
templates.    (See  Map  No.  7.) 

The  following  is  an  extract  from  a  paper  entitled  "Transportation  and  City  Planning," 
presented  by  Milo  R.  Maltbie,  Public  Service  Commissioner,  New  York  City,  at  the  Fifth  Na- 
tional Conference  on  City  Planning,  held  in  Chicago,  May  5tli  to  7th,  1913:  "*  *  *  There  are 
several  lirinciples  of  considerable  importance.  In  the  first  place,  terminals  should  be  elim- 
inated so  far  as  possible.  They  are  costly  to  acquire,  expensive  to  maintain,  and  in- 
crease RATHER  THAN  DECREASE  CONGESTION.  So  F.iR  AS  POSSIBLE,  THE  LINES  SHOULD  BE  OPERATED 
THROUGH  A  CITY  AND  NOT  TERMINATE  THEREIN." 

The  following  is  an  extract  from  a  paper  published  in  the  January,  1914,  issue  of  "The 
Annals  of  the  American  Academy  of  Political  and  Social  Science,"  entitled,  "Relation  Be- 
tween Transit  and  Housing,"  by  John  P.  Pox,  Secretary  of  the  Transit  Committee  of  The  City 
Club  of  New  York : — "***  For  Philadelphia,  Broad  street  should  be  made  the  business  axis, 
with  a  sti-aight  transit  line  from  north  to  south  and  without  the  ill-advised  delivery  loop  sub- 
way now  planned,  which  would  tend  to  duplicate  in  Philadelphia  the  evils  of  Chicago's  congested 
business  center. ' ' 

47 


Through-Routing. 

The  logical  method  of  transportation  in  any  large  city  must  be  on  a  through-routing  plan 
to  be  efficient.  This  shows  beyond  question  that  a  train  should  not  pass  through  the  delivery 
district  more  than  once  in  each  direction  per  single  trip.     (See  Diagrams,  pages  48  and  49.)     • 

A  rapid  transit  line  for  the  purpose  for  which  these  are  built  in  Philadelphia  should  be 
double-ended  whenever  possible,  serving  a  residential  district  on  each  end  and  the  business 
district  in  the  central  section,  so  that  the  expensive  subway  in  the  central  section,  which  acts 
as  a  terminal  of  the  two  lines,  may  be  used  efficiently  in  both  directions.  This  is  known  as 
"through- routing"  method  of  operation,  which  is  eminently  desirable,  and  the  modified  plans 
are  so  arranged  as  to  provide  for  it.  "While  the  "loop"  in  the  business  district  permits  this 
routing  of  North  and  South  Broad  Street  trains,  the  traffic  from  the  two  lines  will  not  balance 
sufficiently  to  use  the  plan  efficiently,  hence  the  "loop"  plan  was  selected.  By  balancing  one- 
half  the  North  Broad  Street  traffic  with  the  Northwestern  Line  and  one-half  with  South  Broad 
and  Darby,  the  "looping"  necessity  is  eliminated  and  better  operation  of  trains  secured.  (See 
Diagrams  Nos.  2  and  3.) 


Surface.  Lines 

i  X 

Transferring 
(Terminal  ^ 


}frmffwfrmfvf>>n»}fw}fm>w/ 


BuSttiESS 


DISTRICT; 


3urfacc  Lines 


TransferrinA 
Termtna! 


> 


R/vpiD    Tramsit  Lime:- 


DIAGRAM   ILLUSTRATING   FUhCTIOH  OF  RAPID 
TRAMSIT  LlIiES  IM  A  UNIFIED  5Y5TEM  AND 
THEPRIhClPLEOF  THR0U6H  ROUTING 


The  Ideal  Local  Transportation  System  for  a  Population  of  3,000,000  Within  a  Circle  of 
12-Mile  Radius. 

These  limitations  have  been  taken  because  it  is  doubtful  if  a  single  five-cent  fare  can  ever 
be  profitable  to  a  unified  system  beyond  such  limits,  except  by  assuming  a  density  of  popula- 
tion greater  than  is  now  considered  desirable.  To  accomplish  it  (if  ever  possible)  full  use  must 
be  made  of  surface  and  rapid  transit  lines,  each  to  the  economic  limit  of  its  possibilities. 

The  fundamental  basis  of  the  ideal  design  for  such  a  system  is  to  divide  the  area  into  three 
transportation  or  traffic  zones.  In  each  zone  the  surface  lines  constitute  the  local  system,  and 
in  the  outer  two  zones  these  surface  lines  concentrate  the  local  traffic  at  convenient  points  or 
terminals  from  which  rapid  transit  lines  run  radially  and  directly  to  the  business  district.  In 
the  outer  two  zones  practically  all  riders  must  transfer  at  the  terminals  from  one  system  to  the 
other. 


48 


Hi^h  5pccd 
Surface  Lines 


Tran5ferrinj;}=) 

'  Terminal   ^ 
o 


Surface  Lines 


Rapid 


[Busimess  District  \ 


"^Sl  Market  street 


'l,„,,,i,,,,,,,,l,,:ii:^/'/,y  ,,,,iy//r/,//lmrrr„^, 


Surface  Car  Termincil 


DIAGRAM  5K0W1MG  APPLICATIOh  OF  PRINCIPLES 
APPLIED  TO  EXISTING  COnOlTIOriS  IN 
WEST    PHILADELPHIA 


The  time  of  travel  practicable  to  secure  and  generally  considered  by  the  public  to  be  a 
reasonable  time  of  transit  between  residential  and  business  districts  has  been  assumed  as  follows : 

Length  of  Journey 

Zone  Service  Eapid  Transit  Surface  Jo™r^nev 

,}:}T\  .^rr'>  (Minutes) 

,  (Miles)  (Miles)  "•  ' 

First        All  surface  car 0  4  25 

Second     Rapid  Transit  (Local)  and  Surface 

combined 4  3  30 

Third       Rapid  Transit   (Express)   and  Surface 

combined 7  4  to  5  35 

_.  Total 

o       ■  Speed  ^\  Time  of 

First        Rapid  Transit   0  0 

Surface    9  25  25 

Second     Rapid  Transit   16'  15 

Surface    12  15  30 

Third       Rapid  Transit   25  16  to  17 

Surface    15  16  to  17  32  to  34 

Beyond  the  third  zone  the  territory  is  considered  in  the  region  of  additional  fare  or  com- 
muters' zone  of  the  steam  roads. 

49 


Diagram  No.  2  shows  this  plan  as  applied  to  ai:  ideal  round  city,  and  Diagram  No.  o 
shows  the  same  principles  applied  to  Philadelphia  as  far  as  its  topography,  population  and  street 
layout  permit. 

Under  this  design  of  a  unified  system,  the  rapid  transit  lines  perform  four  functions : 

1.  That  of  terminal  facilities  in  the  business  district. 

2.  That  of  channels  for  conducting  traffic  flow  through  the  congested  or  older  and  already 
developed  sections  of  the  city. 

3.  That  of  supplementing  the  surface  car  system — not  competing  with  it  for  traffic. 

4.  That  of  supplying  improved  service  to  the  outlying  sections  of  the  city — the  "long 
haul"  rider. 

lu  order  that  it  may  fulfil  this  second  function  properly,  economically  and  at  high-speed, 
the  line  serving  the  Second  Zone  should  have  few  stations  between  the  business  district  and  its 
terminal,  and  the  line  to  the  Third  Zone  but  one  station  (at  the  terminal  of  the  line  to  Second 
Zone  for  transfer  purposes). 

The  lines  when  possible  should  for  practical  reasons  be  foiir-track  through  the  First  Zone, 
and  when  extended  to  the  Third  Zone  should  branch  into  two  or  three  lines,  each  wholly  ex- 
press, with  the  exception  of  the  one  stop  at  the  end  of  the  First  Zone — in  order  to  obtain 
highest  schedule  speed  and  operation  efficiency.  Actually  this  can  seldom  he  done,  but  stops 
on  these  lines  should  be  made  only  where  imperative. 

Rapid  transit  lines  in  such  a  system  are  not  for  local  service  within  the  25-minute  zone  of 
surface  cars,  but  to  bring  a  larger  zone  within  that  time  limit.  They  are  not  to  provide  special 
facilities  for  a  few  favored  localities,  but  to  better  conditions  for  the  whole  district  which  they 
serve.  Rapid  transit  lines  are  necessities  in,  but  not  for,  the  present  surface  car  zone.  They 
must  run  through  this  zone  in  order  to  reach  the  zone  which  they  are  properly  intended  to 
serve.  They  are  the  trunk  arteries  of  the  system  and  not  the  small  veins  and  capillaries,  that 
function  being  filled  more  suitably  by  the  surface  car  system.  Rapid  transit  lines  used  locally 
witliiu  the  surface  ear  zone  are  luxuries.  Their  proper  function  in  Philadelphia  in  a  unified 
system  is  to  bring  a  larger  mass  of  people  within  30  minutes  of  the  business  center  for  the  least 
capital  outlay,  that  is,  to  serve  the  greatest  number  of  people  acceptably  with  the  least  burden 
upon  all.  In  a  unified  system,  rapid  transit  lines  should  be  used  as  express  routes  only,  for 
limited  trains  running  between  terminal  points,  thereby  supplementing  and  extending  the  use- 
fulness of  the  local  surface  street  ear  system,  of  which  they  can  never  take  the  place. 

The  surface  car  is  a  transportation  entcri^rise  using  single  cars  and  doing  business  on  a 
retail  plan. 

The  rapid  transit  lines  are  for  wholesale  transportation,  and  should  never  be  used  where 
the  retail  method  is  more  suitable.  Just  as  in  coouuercial  l)usiness,  a  large  number  of  retail 
dealers  are  needed  to  support  one  wholesale  house,  so  in  this  line,  a  large  number  of  surface 
lines  are  needed  to  gather  or  collect  local  passengers  in  the  districts  four  miles  or  more  from 
the  delivery  district,  and  deliver  them  to  the  rapid  transit  lines  for  transportation  in  wholesale 
quantities  to  the  delivery  district. — See  Map  No.  3  of  "Ideal  Transportation  System  as  existing 
in  West  Philadelphia." 

Ideal  System  (a  Unified  Plan  of  Operation)  Applied  to  Philadelphia. 

The  diagrams  attached  should  make  clear  the  i:>roper  function  of  rapid  transit  lines  in  a 
unified  system,  showing  what  would  be  the  ideal  arrangement  and  what  I  consider  the  best 

50 


0^0    COMMUTCRs-    ^ 
^I*-    6CV0HD  kmile:  rao/us         'Op^ 


CITY    or  PHILADELPHIA 
DCPARTMEMT  OF   CITY    TRAM5IT 


DIAGRAM 

OF 

AN    IDEAL  TRAM5PORTATIOM    SYSTEM 


,  Rapid  Transit   Trunk  l.in«s 

■  Surfaca  F««dcr»  io  Rapid  Transit  Trunk  Lines 


LcqcnD 

...  «^  _  Rapid  Transit  Trunk  Line  extensions    through    Iha    Second    Zona 
Surfac«  Feeders  to  Rapid  Transit  Extensions 


DIAGRAM  NO.  2 


LU  iT)  O 

Z  in  UJ 

'->=:  uj  D 

5!  -"  S^  2r 

<  i_  o-  uj 

'-J  C  K  i- 


DIAGRAM  NO.  3 


MAP  NO.  3 


compromise  for  the  present  as  applying  to  Philadelphia  conditions.  Here  it  is  evident  that 
"ideal"  conditions  exist  in  two  directions  only — north  and  west.  Broad  Street  and  Market 
Street  are  the  only  thoroughfares  reaching  the  business  district  of  sufficient  width  to  permit 
the  construction  therein  of  four  tracks.  The  plans  provide  for  four  tracks  in  Broad  Street 
north,  but  only  two  tracks  south  of  City  Hall.  Quite  probably  before  the  South  Broad  Street 
Line  is  built  it  may  be  desiraible  to  so  change  the  plan  as  to  provide  four  tracks  to  the  south  also. 

In  ]\Iarket  Street  four  tracks  have  been  provided  from  Juniper  Street  to  the  west  side  of  the 
Schuylkill  River  only.  Owing  to  the  favorable  street  arrangement  near  Thirty-second  Street  it 
has  been  possible  to  utilize  the  surface  car  system  on  a  plan  similar  to  that  of  Boston  in  its 
Tremont  and  Boyleston  Street  Subways. 

At  Sixty-ninth  Street  the  local  rapid  transit  line  transfers  to  a  comprehensive  system  of 
high-speed  surface  lines  connecting  with  outlying  towns  and  serving  the  large  adjacent  sub- 
urban territory. 

It  so  happens  at  Sixty-ninth  Street  that  owing  to  different  ownership  of  the  feeder  lines, 
this  is  the  start'of  the  second  fare  zone  as  well  as  the  second  traffic  zone.  As  but  two  tracks  for 
train  service  have  been  built  in  Market  Street,  express  service  at  25  miles  per  hour  as  defined 
in  this  report  is  not  now  possible.     (See  Map  No.  3.) 

Ideal  rapid  transit  service  will  not  be  possible  for  any  suburban  district  under  the  present 
plans  excepting  directly  to  the  north,  via  Broad  Street  Subway.  When  the  express  tracks  of 
this  line  are  next  extended,  they  should  be  extended  by  two  elevated  branches,  each  about  three 
miles  long. 

There  is  no  economic  necessity  or  strategic  reason  for  naming  Olney  Avenue  as  the  north- 
ern terminus  of  this  route,  as  it  is  not  an  important  traffic  center. 

On  all  other  lines,  owing  to  the  limitation  of  street  width,  two  tracks  only  are  provided, 
and  local  rapid  transit  service  with  half-mile  stops  will  be  given  at  a  schedule  speed  approxi- 
mating 16  miles  per  hour.    Lines  with  three  tracks  are  not  desirable  for  Philadelphia  conditions. 

The  Middle  Zone  of  the  City  and  Its  Transportation  Problems. 

The  principal  developed  section  of  Philadelphia,  lying  within  the  four-mile  circle  and  con- 
taining 1,250,000  people  in  1913,  covers  what  may  be  considered  as  the  surface  car  zone  of  eco- 
nomic service  from  a  standpoint  of  time,  as  the  running  time  from  the  business  district  inside 
of  this  zone  should  be  from  25  to  30  minutes,  based  on  an  average  speed  of  8.8  miles  per  hour, 
and  my  observation  has  been  that  there  is  comparatively  little  complaint  where  good  surface 
ear  service  is  maintained  within  the  four-mile  limit.  The  chief  complaint  seems  to  be  not  the 
car  service,  or  the  time  involved,  but  the  8-cent  fare  which  is  troubling  the  people  within  this 
particular  district.  Outside  of  this  district  the  8-cent  fare  is  not  the  chief  cause  of  complaint, 
but  the  time  element  appears  to  be. 

The  modification  of  the  "1907  Contract"  which  has  been  proposed  in  connection  with 
these  new  lines,  is  expected  to  remove  the  cause  of  the  complaint  as  to  the  service  within  the 
four-mile  circle,  and  the  constriiction  of  the  municipal  rapid  transit  lines  will  remedy  to  a 
greater  or  less  degree  the  complaint  of  the  suburlian  districts. 

The  Suburban  Zone  Service. 

Regarding  the  service  in  the  suburban  districts  by  a  direct  line  as  compared  with  the  ser- 
vice wliich  will  result  from  the  present  lines  terminating  at  important  junction  points,  it  may  be 

51 


well  to  discuss  the  matter  in  connection  with  the  proposed  temporary  ending  of  the  North  Broad 
Street  Line  at  Broad  Street  and  Erie  Avenue. 

The  only  large  body  of  population  lying  beyond  the  four-mile  circle  lies  to  the  north,  north- 
east and  northwest,  comprising  the  North  Philadelphia,  Germantown,  Chestnut  Ilill  and  Rox- 
borough  districts. 

The  Northeast  Section  will  be  well  provided  for  by  the  Prankford  Line  to  Bridge  Street. 

The  North  Philadelphia,  Germantown  and  Chestnut  Hill  sections  should  be  satisfactorily 
served  for  the  present  by  the  Broad  Street  Line  with  the  temporary  terminal  at  Erie  Avenue, 
and  Roxborough  will  be  greatly  benefited  by  bringing  the  Ridge  Avenue  surface  line  directly 
east  on  Allegheny  Avenue  and  transferring  to  the  Broad  Street  Subway  at  Broad  Street  and 
Allegheny  Avenue. 

Service  in  the  Germantown  district  by  a  direct  line  to  Germantown  and  Chelten  Avenues 
as  compared  to  the  service  herein  recommended  may  be  discussed  here  as  an  example. 

The  distance  from  Erie  and  Germantown  Avenues  to  Chelten  and  Germantown  Avenues 
by  the  Germantown  Avenue  surface  line — the  most  direct  route — is  2  1/3  miles  and  the  schedule 
running  time  of  the  present  surface  cars  is  15  minutes. 

The  distance  by  way  of  the  rapid  transit  e.\tension  passing  through  Logan  is  3.3  miles  from 
Erie  Avenue  with  a  schedule  running  time  of  11|  minutes.     Assuming  a  person  were  directly 
at  the  intersection  of  Germantown  and  Chelten  Avenues,   the  maximum  saving  of  time  which  1 
would  result  would  be  3^  minutes  in  time  of  transit,  plus  1  minute  for  transferring  at  Broad 
Street  and  Erie  Avenue. 

Inasmuch  as  the  district  within  the  five-minute  walking  zone  of  Germantown  and  Chelten 
Avenues  is  largely  business,  and  will  contain  relatively  few  passengers  for  the  rapid  transit  line, 
it  is  a  fair  assumption  that  the  majority  of  the  patrons  boarding  the  rapid  tran.sit  line  at  this 
point  will  be  brought  there  by  means  of  a  surface  transfer,  so  that  the  time  of  transfer  at  this 
point  will  probably  be  twice  as  long  as  at  Erie  Avenue,  because  at  Erie  Avenue  there  would 
be  twice  the  train  frequency  of  the  branch  lines,  so  that  for  any  one  not  within  walking  dis- 
tance of  the  station  the  actual  time  saving  will  only  be  2|  minutes. 

Based  on  the  present  traffic  figures,  only  about  9,000  passengers  per  day  would  use  this 
station,  and  a  considerable  portion  of  this  traffic  will  be  business  diverted  from  the  steam 
roads  on  Account  of  lower  fare,  and  not  on  account  of  time  saving. 

The  relatively  small  advantage  to  even  this,  the  most  populous  district  in  the  suburban  ter- 
ritory, does  not  warrant  the  expenditure  which  would  be  involved  in  serving  this  district  with 
a  subway  and  elevated  line,  the  cost  of  which  if  built  from  Broad  Street  at  Logan  would  be 
$2,100,000,  or  $4,750,000  from  Broad  and  Erie  Avenue. 

The  logical  method  of  reaching  Germantown  and  Chelten  Avenues  at  some  later  date  is 
shown  on  Frontispiece  and  Map  No.  1  by  means  of  a  branch  from  the  Twenty-ninth  Street — 
Roxborough  Lino,  and  following  on  private  riglit-of-way  the  east  line  of  the  Pennsylvania  Rail- 
road to  Chelten  Avenue,  and  thence  along  Chelten  Avenue  to  the  terminal  proposed. 

Efifect  of  Rapid  Transit  Lines  in  Distribution  of  Population. 

The  time  by  surface  car  to-day  from  the  Prankford  district  to  the  center  of  the  city  is 
about  45  minutes,  the  distance  being  so  great  that  the  Prankford  rapid  transit  line  will  only 
bring  that  district  within  the  25-minute  time  limit  of  the  street  car  zone ;  hence  it  is  extremely 
doubtful  whether  there  will  be  any  extensive  development  beyond  that  point,  as  it  will  have  to 
compete  for  population  with  other  districts  with  more  favorable  time  of  transit. 

52 


MAP  NO.  4 


Tlie  Frankford  district  must  not  expect  to  duplicate  the  development  which  occurred  in 
West  Philadelphia,  for  the  district  west  of  Forty-fifth  Street,  in  which  the  largest  development 
occurred,  averages  less  than  15  minutes  by  the  new  rapid  transit  line  from  the  heart  of  the 
business  district;  the  Fraukfurd  district  is  twice  as  far  and  this  must  be  given  full  consider- 
ation. The  Broad  Street  Lines,  as  now  planned  with  a  temporary  terminal  at  Erie  Avenue, 
will  deliver  people  at  Erie  Avenue  within  14  to  15  minutes,  leaving  a  15-minute  zone  for  the 
use  of  surface  cars,  and  bringing  this  large  area  within  the  same  time  limit  as  Erie  Avenue  on 
the  surface  system. 

The  attached  Map,  No.  4,  shows  the  increase  in  30-minute  time  zone  area  which  will  be 
added  to  that  zone,  with  the  line  terminating  at  Erie  Avenue,  and  the  additional  area  that  will 
be  brought  within  the  zone  should  the  line  be  extended  to  Olney  Avenue  with  elevated  branches 
on  the  Northeast  Boulevard  and  to  Germantown.  A  study  and  comparison  of  these  areas  should 
be  convincing  proof  that  the  Broad  Street  Subway  should  terminate  for  the  present  at  Erie 
Avenue.     (See  Statement  8.) 

Discussion  of  Principle  of  District  Assessment  for  Local  Benefits. 

The  principle  of  assessing  the  property  for  at  least  a  portion  of  the  cost  of  the  city  im- 
provements necessary  for  its  modern  development  is  recognized  in  a  more  or  less  complete  form 
in  Philadelphia.  It  may  be  well  here  to  discuss  its  application  to  this  transit  problem  of 
Philadelphia  and  show  how  localities  benefited  should  divide  the  burden.  ■ 

The  chief  benefits  resulting  from  the  construction  of  rapid  transit  lines  will  accrue  to  two 
zones  of  the  city:  (a)  the  business  district,  which  may  here  be  defined  as  the  district  contained 
within  a  one-mile  radius  drawn  from  Eleventh  and  Market  Streets,  and  (b)  the  districts  lying 
outside  of  a  circle  drawn  with  a  radius  of  four  miles  from  the  same  point.  The  middle  zone 
lying  between  the  first  and  four-mile  circles  will  proibably  be  affected  very  little  by  these  lines 
and  only  along  the  lines  themselves. 

As  all  estimates  of  growth  of  population  in  Philadelphia  show  that  within  50  years  or 
less  the  population  in  Philadelphia  proper  and  the  vicinity  will  exceed  3,000,000,  and  inasmuch 
as  the  available  land  now  lying  within  the  four-mile  circle  is  practically  all  developed,  excepting 
south  of  Oregon  Avenue,  the  future  growth  will  be  largely  distributed  over  the  area  outside  of 
the  four-mile  limit,  and  in  this  district  will  oCvnir  the  greatest  rise  in  land  value. 

Outside  of  the  comfort  and  convenience  resulting  from  the  construction  of  these  improved 
facilities,  the  direct  commercial  profits  will  accrue  very  largely  to  the  two  districts  mentioned. 

In  the  bu.siness  district  the  direct  result  will  be  a  much  larger  volume  of  business  trans- 
acted and  consequently  a  higher  value  for  business  locations  in  certain  parts  of  this  district. 

In  the  outlying  lands  a  large  financial  benefit  will  result  to  the  land  owner  by  virtue  of 
these  lines  bringing  this  land  into  the  market  for  residential  purposes. 

The  method  proposed  in  this  report  of  financing  these  improvements  is  based  on  the  idea 
of  placing  the  burden  of  carrying  charges  on  the  district  receiving  the  principal  benefit. 

The  district  lying  between  the  one-  and  three-mile  circles  will  receive  comparatively  little 
direct  benefit  from  the  building  and  operation  of  these  lines,  but  there  seems  to  be  no  feasible 
way  of  leaving  this  section  of  the  city  out  of  the  calculation,  as  this  land  is  already  improved 
and  fairly  well  served  now  by  the  present  surface  car  system.  Actually  this  zone  should  carry 
but  a  small  part  of  the  burden,  and  that  part  only  on  the  section  lying  along  and  benefiting  by 
the  lines. 

While  the  rapid  transit  lines  will  draw  some  business  from  the  territory  inside  of  the  four- 

53 


mile  circle,  they  must  be  considered  in  that  zone  as  trunk  lines  or  channels  connecting  the  resi- 
dential district  with  the  business  district,  and  not  built  primarily  to  serve  the  intermediate  dis- 
trict, consequently  these  form  the  main  and  terminal  sections  of  the  system,  and  may,  therefore, 
be  paid  for  by  general  bond  issue. 

The  more  or  less  radial  extensions  running;  beyond  the  four-mile  circle  and  into  land  which 
is  largely  undeveloped,  may  properly  be  considered  part  of  the  cost  of  real  estate  development, 
and  the  financing  arranged  for  before  the  construction  actually  takes  place,  upon  the  basis  that 
the  property  benefited  by  their  construction  and  operation  should  assume  the  resulting  burden. 

The  territory  which  has  already  been  developed,  such  as  now  lies  within  the  one-  and  four- 
mile  circles,  is  very  slow  to  change  and  undergo  further  improvement.  The  tax  records  and 
statistics  show  that  very  little  change  has  taken  place  in  this  district  in  recent  years. 

The  report  herewith  appended  (see  Appendices  A  and  B)  shows  that  while  some  advan- 
tages may  accrue  to  this  intermediate  portion  of  the  city  the  great  financial  advantages  accrue 
to  what  are  now  undeveloped  stiiurhan  districts. 

This  plan  of  district  assessment  for  improvements  is  now  permitted  under  New  York  leg- 
islation, and  the  Utica  Avenue  Elevated  Line  in  Brooklyn  is  being  built  by  local  assessment  of 
the  property  benefited. 

To  show  that  property  owners  in  Philadelphia  realize  the  advantages  and  are  willing  to 
co-operate,  a  prominent  resident  inquired  recently  whether  the  City  would  favor  some  of  the 
exten.sions  beyond  what  are  herein  suggested  for  immediate  construction,  provided  the  bene- 
fited sections  would  assume  the  burden  of  the  interest  charges  locally. 

Under  Pennsylvania  laws  now  existing  this  cannot  be  accomplished  unless  it  be  with  the 
voluntary  consent  of  the  aifeeted  properties.     (See  Appendix  C.) 

As  showing  the  justice  of  the  position  herein  outlined,  let  us  discuss  the  extension  author- 
ized by  Councils  of  the  Prankford  Elevated  Line  from  Bridge  Street  to  Rhawn  Street. 

This  would  provide  for  an  extension  of  about  three  miles  and  if  extended  as  an  elevated 
road  along  Prankford  Avenue  would  probably  cost  from  $1,500,000  to  $1,800,000.  If  con- 
structed as  a  surface  high-speed  line  on  private  right-of-way  without  grade  crossings  (the  pref- 
erable plan),  it  would  probably  cost  $600,000  or  .$700,000. 

This  extension  would  benefit  all  the  property  l.ying  between  the  Pennsylvania  Railroad  on 
the  east  and  the  Northeast  Boulevard  on  the  west,  comprising  2,000  aeres  or  more. 

Assuming  that  the  line  is  to  be  constructed  as  a  surface  high-speed  line  on  private  right- 
of-way  at  a  cost  of  $700,000  this  construction  cost  would  amount  to  only  $350  per  acre  if  assessed 
equally  upon  the  zone  directly  benefited.  If  bonds  be  issued  by  that  district  for  the  cost  of  the 
construction,  the  carrying  charges  would  probably  run  not  more  than  $18  to  $20  per  acre  per 
year.  On  land  to  be  developed,  this  is  a  burden  too  small  to  be  considered  as  it  would  only 
represent  $1.00  or  $2.00  per  lot  per  year  during  the  life  of  the  bonds  in  the  territory  when  de- 
veloped. It  may  be  claimed  that  such  a  plan  will  place  too  heavy  a  burden  upon  suburban 
land.  If  this  be  true,  then  evidently  the  development  is  premature  and  the  extension  not  needed 
until  it  will  bear  the  cost  of  its  development. 

The  main  advantage  of  the  principle  of  assessing  locally  the  cost  of  developing  such  sub- 
urban property  is  that  it  acts  as  an  automatic  check  to  the  demand  for  unwarranted  extensions, 
which  clamor  now  has  underlying  it  as  a  large  factor  the  desire  to  get  private  advantage  at  the 
City's  expense.  Under  this  ]i]an  the  land  owners,  who  are  now  most  interested  in  such  exten- 
sions, will  not  clamor  for  it  to  be  made  until  they  are  willing  to  bear  themselves  part  of  the 
burden  which  the  City  would  otherwise  assume  in  its  construction  and  operation. 

Prom  Rhawn  Street  northeast  to  the  City  Line  is  a  very  considerable  area  of  the  city  which 

54 


might  with  equal  justice  clamor  for  improved  service  at  the  City's  expense,  but  as  the  time  of 
travel  increases  with  each  addition  to  the  extended  lines,  the  outlying  land  becomes  less  and 
less  desirable  for  residential  development  of  the  type  popular  in  Philadelphia. 

How  are  the  Bills  to  be  Paid  for  Constructing  and  Operating  the  Rapid  Transit  System? 

Under  the  "Taylor  Plan"  all  money  for  construction  is  to  be  raised  on  the  City's  credit 
by  issuing  City  bonds  for  the  entire  amount.  All  equipment  is  to  be  furnished  by  the  operat- 
ing company. 

Under  the  plan  herein  suggested  only  the  trunk  and  terminal  portions  of  the  system  are 
to  be  financed  and  paid  for  on  the  City's  general  credit,  out  of  City  bonds.  The  outlying  and 
suburban  sections  are  assumed  to  be  built,  or  at  least  financed,  on  bonds  secured  by  local  assess- 
ment upon  the  real  estate  for  properties  benefited  by  the  construction  and  operation  of  these 
extensions. 

The  following  table  gives  the  lines  considered  as  terminal  or  trunk  lines,  and  the  lines  con- 
sidered as  branch  or  suburban  lines,  and  the  relative  proportion  of  the  City's  obligation  and 
the  local  obligation  involved : 


TRUNK  AND  TERMINAL  LINES  TO  BE  FINANCED  BY  CITY  BONDS. 

(Shown  in  red  on  Map  No.  5.) 

Estimated  cost,  „,,        ,     , 

including  real  When  to  be 

estate.  ^"^l*" 

1.     Prankford  Elevated  to  Bridge  Street $6,000,000  Step  1 

f  Broad  Street  Subway— Pike  to  Spruce  Street 18,400,000    ] 

2-  I  Ridge  Avenue,  Eighth  Street,  Walnut  to  Sixteenth    Street 7,200,000  j  ^^'^P  ^ 

(  Parkway— Twenty-ninth  Street  to  Hunting  Park  Avenue 6,200,000  Future 

3.  I  Southwestern  Line — via  Broad,  Federal  and  Woodland  Avenue         5,500,000  Future 

I  South  Phila.— Broad  Street,  Federal  to  Oregon  Avenue 2,600,000  Future 

Total $45,900,000 

BRANCH  LINES  AND  EXTENSIONS  PROPOSED  TO  BE 
FINANCED  ON  PRINCIPLE  OF  ASSESSMENT  OF 
LOCAL  BENEFITS. 

Broad  Street,  Pike  to  Olney  Avenue .$4,300,000 

Broad  Street,  Oregon  to  League  Island 700,000 

Northeast  Branch  on  Boulevard 1,500,000 

Roxborough  Extension  from  Twenty-ninth  and  Hunting  Park  Ave.  1,800,000 

Germanto\vn  Branch 2,100,000 

Frankford  Elevated  extension  to  Rhawn  Street 1,800,000 

Byberry  Line 1,100,000 

Total $13,300,000 

Grand  Total  $59,200,000, 


oo 


This  total  does  not  check  with  the  estimates  as  given  in  table  of  comparative  outlay  as 
Darby  Line  outside  of  City  Line  is  omitted  from  these  figures  and  routes  do  not  exactly  cor- 
respond in  the  two  estimates.     (See  Statement  7.) 

The  following  quotation  from  a  paper  by  Nelson  P.  Lewis,  Chief  Engineer  of  the  Board  of 
Estimate  and  Apportionment  of  New  York  City,  expresses  these  principles  in  such  shape  that 
I  quote  from  his  paper  as  follows: 

"The  general  principles  which  should,  in  the  writer's  opinion,  govern  the  distribution 
of  the  cost  of  city  improvements  may  be  briefly  summarized  as  follows: 

"1.     Where  there  is  local  benefit,  there  should  always  be  local  assessment. 

"2.  The  entire  city  or  the  metropolitan  district  should  bear  no  part  of  the  expense 
unless  the  improvement  is  in  some  degree  of  metropolitan  importance  and  benefit. 

"3.  Assessments  should  not  be  coniined  to  the  cost  of  acquiring  and  improving  streets, 
but  should  extend  to  any  improvement  which  will  increase  the  value  of  the  neighboring 
property,  and  should  be  apportioned  as  nearly  as  possible  according  to  the  probable  benefit. 

"4.     A  workable  policy  once  adopted  should  be  consistently  adhered  to. 

"5.  The  determination  of  a  policy  and  its  application  to  each  case  should  be  entrusted 
to  a  board  composed  of  men  especially  qualified,  whose  terms  of  office  should  so  overlap  as 
to  insure  continuity  of  policy  and  purpose." 

I  have  never  heard  any  real  objection  made  to  the  principle,  though  objections  arise  as  to 
the  practical  method  of  application.  At  present  such  methods  for  rapid  transit  construction 
in  Philadelphia  appear  to  have  no  legal  basis,  and  I  would  urge  that  whatever  enabling  legisla- 
tion may  be  necessary  the  City  should  obtain  at  the  next  session  of  the  Legislature,  so  that  this 
fair,  just  and  equitable  method  of  financing  these  lines  may  be  available  for  use  at  the  City's 
option. 

The  principle  of  assessing  projierty  for  city  improvements  is  already  well  established,  the 
original  cost  of  pavement  being  charged  against  the  abutting  property,  as  well  as  certain  costs 
for  sewers,  water  pipes,  etc.,  which  are  recognized  as  necessary  for  the  development  of  the  prop- 
erty. Trunk  and  main  sewers  are  charged  against  the  city  as  a  whole,  local  sewers  being 
charged  against  the  property  benefited.  Logically  there  is  no  sound  reason  why  a  portion  of  the 
rapid  transit  system  in  the  suburban  district,  which  is  equally  as  necessary  as  the  sewerage  sys- 
tem, should  not  be  charged  in  part  at  least  against  the  property  benefited.     (See  Appendix  C.) 

Alternate  Method  of  Financing  Branches  and  Extensions  of  the  Trunk  Portion  of  the  System. 

In  ease  it  should  be  found  undesirable  or  inexpedient  for  any  reason,  legal  or  otherwise, 
to  finance  the  cost  of  extensions  by  means  of  special  bond  issues  assessed  locally  on  the  property 
benefited  to  meet  the  carrying  charges,  I  would  make  the  suggestion  that  an  alternate  method 
of  placing  the  burden  of  these  extensions  on  the  territory  and  people  benefited  may  be  found 
in  a  proper  adjustment  of  the  rate  of  fare  of  the  rapid  transit  lines  in  such  sections  of  the  city, 
this  rate  of  fare  being  periodically  adjusted  so  that  it  would  grow  less  as  the  section  builds  up 
and  becomes  more  thickly  populated  and  the  number  of  riders  increases  per  year,  it  being  placed 
at  a  figure  at  the  beginning  which  will  not  be  prohibitory. 

56 


This  alternate  method  has  the  same  advantage  as  local  assessment  of  the  property — acting 
as  an  automatic  cheek  on  unwarranted  demands  for  extensions  and  thus  protects  the  City 
Treasury. 

The  additional  fare  required  on  each  extension  could  be  approximately  determined  in  ad- 
vance, and  while  it  would  be  somewhat  troublesome  to  work  out  the  practical  difficulties  of  a 
two  zone  system  with  transfers  and  different  fares  in  the  two  zones,  I  believe  it  is  not  impos- 
sible to  accomplish  such  a  result  if  deemed  desirable. 


57 


MAP  NO.  5 


r- 


SUGGESTED  IMPROVEMENTS  IN  THE  PLANS  FOR  RAPID 
TRANSIT  DEVELOPMENT 


Suggested  Improvements  in  the  Construction  Program  of  the  Taylor  Plan. 

Briefly,  it  may  be  here  stated  that  there  is  no  intention  to  suggest  changes  in  the  location 
or  extent  of  the  main  radial  rapid  transit  lines  recommended  in  the  "Taylor  Plans." 

The  change  contemplated  is  not  in  the  main  routes  themselves — the  improvements  suggested 
herein  relate  chiefly  to  what  I  consider  an  unwise  and  unbusinesslike  proposition  to  build  these 
lines  all  at  once,  and  to  carry  them  into  suburb.m  districts  now  very  thinly  populated — into  sec- 
tions which  should  for  several  years  at  least  be  served  by  surface  lines. 

I  strongly  favor  the  breaking  up  of  the  construction  program  into  a  series  of  steps  with, 
as  yet  undetermined,  intervals  of  time  between  the  steps,  so  that  the  construction  program  will 
be  extended  over  a  period  of  years  and  the  City  and  the  operating  company  will  be  able  to 
digest  and  assimilate  the  results  of  each  step  before  another  is  added. 

In  outline  the  suggested  construction  program  consists  of: 

First.  A  progressive  step  method  of  construction  whereby  the  Frankford  Elevated  be- 
tween Arch  Street  and  Bridge  Street,  and  the  Broad  Street  Subway  between  Spruce  Street  and 
Erie  Avenue,  will  be  constructed  first,  leaving  the  extension  of  the  former  to  Rhawn  Street, 
and  the  extensions  of  the  latter  to  League  Island,  Olney  Avenue,  Germantown  and  the  Boule- 
vard (as  provided  by  Ordinance  of  Councils  and  authorized  by  the  people  in  the  $6,000,000 
loan)  until  a  later  date,  at  present  indeterminate. 

Second.  A  change  in  the  lines  of  subway  in  the  business  district  whereby  the  delivery 
area  will  be  more  directlj^  reached,  the  stations  more  advantageously  placed  and  the  cost  of 
construction  lessened. 

No  change  is  now  contemplated  between  Ridge  and  Erie  Avenues,  but  it  is  proposed  that 
on  the  south  two  of  the  four  tracks  be  diverted  at  this  point  to  pass  by  way  of  Ridge  Avenue, 
Eighth  Street  and  Walnut  Street  to  near  Sixteenth  Street,  leaving  only  two  tracks  to  continue 
southward  in  Broad  Street.  Also,  it  is  proposed  that  the  future  Parkway  Subway  to  the  north- 
west be  designed  to  turn  down  Sixteenth  Street  and  into  Walnut  Street,  thus  providing  for  the 
viltimate  routing  of  some  of  the  North  Broad  Street  trains  through  to  Roxborougli  by  way  of 
Eighth  and  Walnut  Streets,  while  the  remainder  will  be  routed  through  to  League  Island, 
and  the  Southwestern  Line  through  the  Fortieth  Ward.  This  change  in  the  Parkway  Line 
does  away  with  the  need  for  four  tracks  south  of  Filbert  Street,  and  with  the  need  for  a 
junction  station  under  City  Hall.  Therefore,  it  is  proposed  to  change  the  line  of  the  two  Broad 
Street  tracks  between  Arch  Street  and  South  Penn  Square  so  as  to  permit  the  placing  of  the 
City  Hall  Station  at  Filbert  Street,  where  it  can  be  brought  nearer  to  the  surface  of  the  street 
and  where  it  will  cause  less  congestion  of  trafiSc  and  will  cost  far  less  to  construct.  (See  Map 
No.  6.) 

59 


Suggested  Construction  of  Comprehensive  System  in  Successive  Steps. 
Construction  Step  No.  1. 

Complete  the  Frankford  Elevated  to  a  point  at  or  near  Bridge  Street  on  the  northern  end, 
and  build  the  section  from  Callowhill  Street  south,  connecting  with  the  existing  Market  Street 
Line  of  the  Philadelphia  Rapid  Transit  Company,  permitting  the  Frankford  Line  to  be 
through-routed  with  the  present  Market  Street  Line. 

Although  the  present  ordinance,  under  which  the  Frankford  Line  is  being  constructed,  au- 
thorizes the  building  of  the  road  north  of  Bridge  Street  as  far  as  Rhawn  Street,  I  do  not  con- 
sider it  desirable  that  it  be  built  north  of  Bridge  Street  at  the  present  time.  Even  if  it  he 
legally  decided  that  it  must  be  built,  that  will  not  change  the  economic  fact  that  it  is  not  now 
ivarranted. 

The  territory  lying  north  and  northeast  of  Bridge  Street  should  for  a  number  of  years 
be  served  and  developed  by  trolley  surface  feeders,  which  in  this  district,  for  several  years  at 
least,  should  be  able  to  run  at  a  schedule  speed  of  at  least  12  miles  per  hour.  This  speed  is 
now  maintained  by  trolley  lines  connecting  at  this  point. 

Under  these  conditions  the  City  is  not  warranted  in  spending  a  large  amount  of  money  for 
the  elevated  construction  as  the  maximum  time  saving  to  passengers  living  at  Rhawn  Street 
cannot  exceed  three  minutes.  This  difference  is  too  small  to  warrant  the  use  at  present  of 
anything  more  expensive  than  high-speed  surface  trolley  lines  on  private  right-of-way.  Fur- 
thermore, Philadelphia  should  not,  like  New  York,  make  the  serious  mistake  of  building  high- 
speed elevated  lines  into  relatively  remote  suburbs  and  ignoring  the  capabilities  of  siirface  lines 
as  transportation  feeders. 

There  is,  furthermore,  this  point  for  consideration:  Bridge  Street  on  Frankford  Avenue 
is  now  the  present  limit  of  the  5-cont  fare  zone  from  the  center  of  the  city,  and  any  extension 
beyond  this  should  be  seriously  considered  in  view  of  its  evident  effect  on  the  operating  lease  of 
the  City's  system.  An  independent  company  is  now  operating  the  surface  trolley  line  north  of 
Bridge  Street  along  Frankford  Road  to  City  Line,  connecting  with  lines  operating  into  Bristol 
and  Trenton,  and  legal  complications  might  ensue,  together  with  opposition  from  the  Public 
Service  Commission  if  the  City  entered  this  territory  as  a  competitor. 

Construction  Step  No.  2. 

Build  the  North  Broad  Street  Subway  from  a  point  near  Erie  Avenue  on  the  north  to 
Ridge  Avenue  on  the  south  as  a  4-track  construction,  dividing  at  Ridge  Avenue  into  two 
2-track  subways — one  pair  of  tracks  extending  south  along  Broad  Sti-eet  to  a  point  near  Spruce 
Street,  the  other  pair  of  tracks  turning  east  along  Ridge  Avenue  to  Eighth  Street,  south  on 
Eighth  Street  to  Walnut  Street  and  west  on  Walnut  Street  to  a  point  near  Sixteenth  Street. 
On  the  lower  end  both  lines  would  terminate  in  stub-terminals  until  the  connections  for  through- 
routing  are  established,  as  stub-terminals  will  provide  sufficient  terminal  facilities  for  30  trains 
per  hour.  This  would  form  the  first  section  of  the  line  and  is  in  conformity  with  principles  Nos. 
1,  2,  4,  5,  and  7  enunciated  on  page  12. 

Importance  of  Erie  Avenue  a^  Temporary  Northern  Terminal  of  Broad  Street  Lines. 

At  no  other  point  along  the  Broad  Street  Line  is  it  possible  as  it  is  at  Erie  Avenue  to  focus 
readily  a  large  number  of  surface  trolley  lines  which  by  transfer  can  utilize  the  high-speed  lines 
to  hring  the  passengers  which  they  may  have  collected  into  the  center  of  the  city.     This  utilizes 

60 


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DIAGRAM   NO.  4 


the  surface  lines  efficiently  in  the  territory  north  of  Erie  Avenue  and  reduces  the  operator's 
investment  and  the  car  mileage  by  about  twenty-five  per  cent,  as  compared  with  operating  the 
two  extensions  above  Erie  Avenue.  As  this  reduces  both  the  operating  expenses  and  interest 
charge  coming  ahead  of  the  City's  share  of  the  earnings  it  is  greatly  to  the  City's  advantage, 
as  is  evident  from  the  statement  of  operating  results  attached.      (See  Statements  5  and  6.) 

It  will  be  noted  that  this  will  require  the  opening  of  Ridge  Avenue  through  the  block  at 
Eighth  and  Ninth  Streets  in  accordance  with  the  plans  for  the  "Traffic  Circuit,"  which  have 
formerly  been  proposed. 

Walnut  Street  Line. 

Walnut  Street  is  now  suggested  in  place  of  Locust  Street  for  the  location  of  the  south  line 
of  the  subway,  chiefly  because  it  is  planned  that  this  line  will  eventually  be  extended  to  Six- 
teenth Street,  and  north  on  Sixteenth  Street  to  the  Parkway,  and  then  in  a  northwest  direc- 
tion to  serve  Roxborough,  Germantown,  etc.  Farthermore  the  delivery  on  Walnut  Street  will 
be  more  desirable  than  on  Locust  Street,  and  to  that  extent  will  reduce  objectionable  transfer- 
ring. For  this  side  of  the  route  Chestnut  Street  might  be  more  desirable,  as  it  will  involve 
building  1,000  feet  less  of  subway  and  provide  better  delivery  for  passengers,  thereby  reducing 
transferring;  but  Locust  Street  can  be  used  if  deemed  absolutely  necessary  for  other  than  tran- 
sit reasons.  Walnut  Street  is  suggested  as  a  compromise,  believing  that  Chestnut  Street  should 
be  left  open  for  occupancy  of  future  lines. 

Locust  Street  was  originally  recommended  for  the  south  leg  of  the  "Delivery  Loop,"  be- 
cause it  was  then  expected  that  it  might  promptly  be  widened  to  134  feet,  and  also  because  it  is 
impossible  to  place  a  station  at  Broad  and  Chestnut  Streets  unless  this  side  of  the  Loop  be  taken 
south  to  Locust  Street. 

As  there  is  no  immediate  prospect  of  widening  Locust  Street,  and  as  the  curves  and  switches 
which  formerly  controlled  that  location  are  eliminated  in  this  plan,  there  is  no  engineering  rea- 
son why  either  Chestnut  Street  or  Walnut  Street  may  not  be  used  for  this  portion  of  the  Broad 
Street-Northwestern  Route. 

As  the  number  of  streets  in  the  business  district  available  for  use  by  rapid  transit  lines  is 
very  limited,  I  feel  that  it  is  very  important  to  use  such  streets  efficiently;  that  is,  pass  trains 
through  the  business  district  only  once  per  trip  and  use  only  one  street  as  the  terminal  of  two 
radial  or  trunk  lines.  This,  if  for  no  other  reason,  should  force  the  adoption  of  through-rout- 
ing operation. 

Temporary  Stub-End  Terminals. 

The  method  of  operation  favored  in  this  report  would  utilize  stub-end  terminals  at  the 
northern,  southern  and  western  ends  of  these  lines  as  these  stopping  points  are  considered  tem- 
porary, to  be  used  only  until  exten.sions  are  built  on  the  northern  end  and  additional  lines  are 
brought  in  and  connected  on  the  lower  ends,  so  that  through-routing  operation  can  be  insti- 
tuted. 

Train  Capacity. 

The  Broad  Street  Subway  and  Loop,  as  originally  recommended,  was  designed  to  have  a 
maximvim  ultimate  capacity  of  forty  10-car  trains  per  hour  over  each  track  (400  cars  per 
hour). 

5  61 


The  present  ^Market  Street  Line  of  tlie  Philadrliihia  Rapid  Transit  ('nnipaiiy  is  (iperated 
with  a  stub-terminal  on  tlie  eastern  end  at  South  Street  Ferry,  and  is  handling  a  maximum  of 
thirty-four  trains  per  hour. 

The  proposition,  therefore,  to  use  stub-terniinals  at  Broad  and  Spruce  Streets  and  at  Six- 
teenth and  Walnut  Streets  until  such  time  as  these  lines  are  extended,  is  a  perfectly  good  busi- 
ness proposition,  as  there  is  every  probability  of  these  lines  being  extended  long  before  the 
Broad  Street  section  has  reached  75  per  cent,  of  its  maximum  capacity. 

Under  this  plan  the  important  commercial  district  in  the  neighborhood  of  Eighth  and 
Market  Streets,  and  the  financial,  hotel  and  railroad  district  along  Broad  Street  north  of  Spruce 
Street,  will  be  served  equally  as  well  as  by  the  present  recommended  plan,  and  by  using  the  di- 
rect route  along  Ridge  Avenue  the  running  time  from  Erie  Avenue  to  Eighth  and  Market 
Streets  will  be  approximately  the  same  as  to  City  Hall  Station. 

Under  these  modified  plans,  the  time  of  transit  between  Erie  Avenue  and  Eighth  and  Mar- 
ket Streets  will  be  13  minutes,  a  saving  of  2^  minutes  over  the  time  required  in  transit  between 
these  two  points  by  the  former  "loop"  route. 

Reasons  for  Constructing  Four  Tracks  on  Broad  Street. 

The  wisdom  of  recommending  the  construction  of  four  tracks  in  Bi-oad  Street  between 
Ridge  Avenue  and  Erie  Avenue  may  be  questioned  in  view  of  the  fact  that  one  of  the  avowed 
reasons  for  limiting  the  amount  of  construction  work  is  to  reduce  the  initial  capital  outlay,  and 
it  may  reasonably  be  inquired  whether  it  will  not  be  better  to  construct  two  tracks  only  in 
Broad  Street  at  this  time  and  divert  the  money  thus  saved  to  the  construction  of  one  of  the 
other  branches,  such  as  the  Parkway  Line  or  the  Woodland  Avenue  Line. 

In  the  Transit  Commissioner's  Report  of  July,  1913,  will  be  found  Plan  No.  56,  showing 
that  this  plau  was  originally  considered,  and  the  original  estimates  were  prepared  on  a  basis 
of  both  four  and  two  tracks. 

At  that  time  the  estimated  cost  for  the  2-tra(k  line  from  Race  Street  to  Olney  Avenue  was 
approximately  $14,000,000,  and  the  additional  amount  required  to  add  two  additional  tracks  in 
the  section,  between  Race  Street  and  Erie  Avenue,  anuninted  to  about  $5,000,000,  or  about  30 
per  cent,  additional. 

As  the  estimated  traffic  on  the  Broad  Street  Line  will  be  beyond  the  capacity  of  a  2-track 
subway  (400  ears  per  hour — one  way)  after  19.50,  it  is  not  deemed  advisable  to  recommend  the 
building  of  two  tracks  now  and  in  a  few  years  again  tearing  up  the  street  for  the  purpose  of 
adding  the  other  two  tracks. 

Should  the  Parkway — Twenty-ninth  Street  Line  to  the  northwest — be  Imilt  by  1930,  two 
tracks  on  Broad  Street  will  be  ample  for  several  years  beyond  that  date.  This  question,  in  view 
of  the  service  needed  by  the  Parkway,  may  propi-rly  be  the  subject  of  a  further  discussion  and 
report. 

The  amount  saved  on  the  North  Broad  Stri-et  Line  will  not  be  sufficient  to  liuild  either 
of  the  other  branches,  and  it  may  cost  as  much  as  $10,000,000  to  add  the  other  two  tracks  after 
1930.  It  seems  to  be  a  better  plan  to  finish  eacli  section  of  the  route  complete  as  far  as  it  may 
l)e  carried  rather  than  to  again  disttirl)  the  street — jiarticularly  a  street  like  Broad  Street, 
which  is  the  main  automobile  thoroughfare  north  and  south. 

Should  the  line  be  leased  to  an  operator  independent  of  the  Philadelphia  Rapid  Transit 
Company,  I  might  advocate  the  building  of  only  two  tracks  now,  as  the  interval  before  the 
othei'  two  tracks  will  be  needed  will  be  several  j'cars  longer. 

62 


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CITY  OF  PHILADELPHIA 
DEPARTMENT  OF  CITY  TRANSIT 

DIAGRAM  OF 

MODIFIED  RAPID  TRANSIT  SYSTEM 

WITH  THROUGH  ROUTING 

(Steps  1  and  2  shown  in  RED) 


DIAGRAM  NO.  5 


When  the  territory  north  of  Erie  Avenue  develops  sufficiently  to  require  rapid  transit  ser- 
vice beyond  that  point,  four  tracks  will  be  needed  from  the  business  center  to  Erie  Avenue. 

Conxiniction  of  Camden  Tube. 

Under  a  proper  franchise,  subject  to  proper  governmental  permits  and  restrictions,  per- 
mission may  be  granted  the  Philadelphia  Rapid  Transit  Company,  or  a  subsidiary  lessee  com- 
pany, to  construct  a  tunnel  connecting  the  Market  Street  Line  with  lines  running  into  New 
Jersey,  to  fee  built  entirely  with  private  capital  and  to  be  operated  under  such  terms  as  to 
fares,  etc.,  as  may  be  agreed  upon. 

Successive  Steps  and  Extensions  in  the  Future. 

Step  No.  2,  which  constitutes  the  trunk  or  terminal  section  of  the  Broad  Street  Subway, 
.should,  at  later  dates  as  yet  undetermined  and  to  be  fixed  by  the  development  and  traffic  neces- 
sities of  the  city,  be  utilized  to  its  fullest  extent  by  building  rapid  transit  lines  and  extensions 
to  connect  therewith,  (a)  to  Roxborough  and  Germantown,  (b)  Southwest  Philadelphia,  (c) 
South  Philadelphia,  (d)  Logan,  Olney  and  points  north  of  Erie  Avenue;  these  lines  to  be 
built  at  such  times  and  in  such  sequence  as  traffic  may  warrant. 

A  comprehensive  plan  of  through-routing  will  become  effective  only  when  such  lines  are 
built. 

The  complete  system  is  shown  in  diagrammatic  form  on  Diagram  No.  a. 

Time  of  Construction  and  Operation. 

The  time  needed  for  the  construction  of  Step  No.  1  should  not  vary  to  any  extent  from  that 
outlined  in  the  Transit  Commissioner's  Report  of  1913,  except  insofar  as  it  may  be  necessary 
to  delay  the  final  completion  of  the  lines  until  it  is  finally  determined  whether  they  shall  be 
leased  to  the  Philadelphia  Rapid  Transit  Company  or  to  an  independent  operator.  To  com- 
plete Step  No.  1  (the  Fraukford  Elevated)  will  probably  require  about  one  year  after  the  exe- 
cution of  an  operating  contract. 

The  time  necessary  to  complete  Step  No.  2  will  be  practically  the  three  years  allowed 
under  the  former  program,  inasmuch  as  the  time  necessai-y  to  complete  the  entire  line  should  be 
the  time  necessary  to  complete  the  most  difficult  or  slowest  section  of  the  line. 

If  the  money  be  available  and  the  contracts  a-warded  during  the  fall  of  1916,  the  lines  should 
be  in  operation  by  the  fall  of  1919. 

Comparison  of  Cost  of  Construction — Amount  of  Loan  Suggested. 

Appended  to  this  report  will  be  found  a  comparative  statement  showing  the  estimated  cost 
of  the  comprehensive  con.struction  program  as  outlined  in  the  193  5  Annual  Report,  and  the 
Steps  Nos.  1  and  2  as  suggested  in  this  report.     (See  Statement  7.) 

As  previously  stated  in  the  1915  Report  a  loan  of  $.50,000,000  was  requested  to  carry  out 
the  construction  program  as  outlined.  The  estimates  used  have  been  the  same  in  each  case  as 
far  as  possible  based  on  the  average  prices  prevailing  in  the  last  two  or  three  years  for  contract 
work  of  similar  character  in  New  York  and  other  cities.  In  view  of  the  rapid  rise  in  the  cost  of 
steel,  cement  and  labor,  which  is  now  takituj  place,  beginning  ivith  the  latter  part  of  1915,  it 

63 


may  be  douhtcd  whether  the  work  can  be  contracted  now  on  the  basis  of  these  estimated 
prices.  In  order  to  provide  against  tliis  or  any  other  contingency,  I  have  deemed  it  wise  to 
ask  that  the  authorization  by  the  people  at  the  present  time  for  the  completion  of  construction 
of  Steps  Nos.  1  and  2,  be  made  $35,000,000,  although  this  figure  should  be  considerably  in  excess 
of  the  amount  absolutely  required,  now  estimated  at  about  $25,600,000.  Bonds  should  be  issued 
under  this  authorization  only  as  needed,  hence  this  authorization  should  in  no  wise  burden  the 
City  with  unnecessary  interest  charges  or  with  funds  lying  idle  in  the  City  Treasury,  and  any 
balance  not  used  on  Steps  Nos.  1  and  2  will  be  available  for  future  steps  of  the  construction  pro- 
gram. 

Why  is  Construction  in  Progressive  Steps  Advised? 

For  reasons  that  are  largely  financial,  I  advise  that  the  City's  program  for  improved  tran- 
sit facilities  be  made  to  ^gree  with  the  City's  actual  needs  for  such  facilities. 

The  comprehensive  system  called  for  by  the  latest  "Taylor  Plans"  if  constructed  at  the 
present  time  will  doubtless  call  for  an  outlay  within  the  nest  three  years  in  excess  of  $63,000,000 ; 
$6,000,000  has  been  appropriated  for  this  work,  leaving  approximately  $57,000,000  necessary  to 
complete  this  system. 

A  loan  of  $50,000,000  was  requested  in  December,  and  according  to  a  statement  of  the 
Controller,  $69,000,000  of  the  City's  borrowing  capacity  is  available  and  may  be  applied  to  this 
purpose. 

To  many  people  it  will  probably  seem  strange,  that  with  this  large  amount  available, 
there  should  be  recommended  at  this  time  the  expenditure  of  less  than  $30,000,000,  and  the  con- 
struction of  but  two  initial  stei:)s  of  what  is  intended  to  eventually  be  a  complete  rapid  transit 
system. 

The  reason  for  keeping  the  initial  expenditure  within  a  conservative  limit  is  that  any  ex- 
penditure in  excess  of  this  amount,  particiilarly  at  this  time  of  abnormally  high  prices,  becomes 
an  unwarranted  burden. 

A  table  is  appended  to  this  report  giving  a  comparison  of  the  amounts  of  the  City's  direct 
obligation  on  the  different  plans.     (See  Statements  5  and  6.) 

The  results  are  summarized  on  Statement  2. 

In  the  face  of  such  figures,  any  proposal  for  an  initial  expenditure  greater  than  stated 
cannot  be  justified. 

Full  consideration  has  been  given  to  the  incidental  advantages  resulting  from  other  rapid 
transit  lines,  and  from  extensions  beyond  tlie  points  now  advocated,  and  the  construction  con- 
templated in  Steps  Nos.  1  and  2  is  the  result  of  careful  study  and  consideration  of  any  advan- 
tages which  the  City  might  derive  from  a  more  extensive  initial  construction. 

The  final  "Taylor  Plans"  construction  program  represents  a  construction  outlay  of  over 
$60,000,000  and  a  deficit  in  fixed  charges  will  accrue  by  1940  in  excess  of  $30,000,000,  making 
the  total  cost  to  the  City  over  $90,000,000.     (See  Statement  6.) 

The  progressive  method  of  making  provision  for  future  needs  is  used  in  practically  every 
line  of  business. 

The  Wanaraaker  Store  and  Curtis  Building  are  conspicuous  local  examples.  These  enter- 
prises have  developed  by  progressive  steps  extending  over  several  decades,  each  having  been 
built  to  meet  the  needs  of  an  established  business.  Had  these  magnificent  buildings  been 
erected  thirty  years  ago,  they  would  have  been  so  far  in  advance  of  the  business  requirements 
that  financial  disaster  surelj-  must  have  resulted. 

04 


If  it  is  sound  business  to  so  conduct  a  private  enterprise,  the  same  argument  should  carry 
weight  in  a  city  experiment  such  as  contemplated. 

The  mere  fact  that  the  City  finds  it  absolutely  necessary  to  undertake  this  transportation 
enterprise  on  account  of  its  not  being  financially  attractive  to  private  capital  warrants  the  posi- 
tion herein  assumed  that  this  experiment,  if  financed  on  the  City's  credit,  should  be  made  grad- 
ually and  with  caution. 

The  mere  fact  that  the  City  can  draw  on  the  taxpayers  for  the  deficit  in  its  interest  and 
sinking  fund  obligations,  while  a  private  company  has  not  that  resource,  should  be  no  valid 
argument  for  a  reckless  expenditure  of  the  people's  money. 

Nearly  every  one  admits  the  soundness  of  the  principles  underlying  the  progressive  or 
step  program  herein  proposed.  It  is  only  when  it  is  proposed  to  apply  it  to  his  own  district  or 
locality  that  opposition  is  aroused. 

This  is  a  psychological  and  political  phase  of  the  problem  which  it  is  useless  to  discuss 
here. 

Every  man  should  allow  his  conscience  to  decide  his  position  when  his  personal  interests  and 
rights  conflict  with  those  of  the  City. 

In  this  connection  it  may  be  well  to  call  attention  to  a  matter  which  has  been  apparently 
overlooked  by  the  public;  namely,  that  the  "Taylor  Plans"  have  never  been  officially  approved 
as  a  whole  by  Councils  and  are  being  constructed  on  the  progressive  or  step  program,  so  that 
the  program  herein  outlined  is  pi-actieally  now  in  effect. 

About  a  year  ago  $6,000,000  was  authorized  and  appropriated  for  what  was  popularly 
understood  to  be  a  start  upon  the  Frankford  Line  and  the  Broad  Street  Lines. 

This  initial  appropriation  of  $6,000,000  may  be  considered  as  the  City's  endorsement  of 
a  limited  plan  of  rapid  transit  consisting  of  two  routes  only — and  not  the  entire  "  Taylor  Pi-o- 
gram. "  As  this  sum  was  only  abovit  20  per  cent,  of  the  sum  estimated  as  the  construction  cost 
of  these  routes,  it  is  referred  to  in  this  report  as  Step  No.  1  of  the  construction  program. 

This  sum  of  $6,000,000  was  borrowed  at  a  6  per  cent,  rate  for  interest  and  sinking  fund, 
thus  drawing  $360,000  annually  on  the  tax  revenues  of  the  City. 

It  was  explained  at  that  time  that  it  was  not  desirable  to  borrow  more  than  the  sum  of 
$6,000,000,  which  it  was  estimated  would  finance  the  construction  contracts  until  cheaper  funds 
were  availahle,  these  cheaper  funds  being  money  borrowed  under  the  new  legislation,  which 
allows  the  issuance  of  50-year  bonds  with  graduated  sinking  fund  and  the  capitalization  of  in- 
terest and  sinking  fund  during  construction  and  first  year  of  operation. 

The  only  difference  between  the  "Taylor  Plan"  and  what  is  here  advocated  is  that  the 
"Taylor  Plan"  called  for  about  $50,000,000  to  finish  the  comprehensive  system  in  a  second 
step,  whereas  this  plan  contemplates  an  expenditure  of  about  $25,000,000  in  the  second  step, 
leaving  the  balance  to  be  carried  forward  when  conditions  warrant. 


Effect  of  Gradual  Construction  by  Steps  on  the  Lessee  of  City's  System. 

The  question  will  be  raised  whether  the  method  of  construction  herein  outlined  is  not  to 
the  financial  advantage  of  the  Philadelphia  Rapid  Transit  Company,  the  assumed  lessee  of  this 
system.  This  question  cannot  be  answered  either  affirmatively  or  negatively  without  full 
knowledge  of  the  terms  of  the  lease.  It  is  the  lease  which  will  determine  the  advantages  flow- 
ing to  the  lessee — not  the  construction  program.    This  is  further  discussed  elsewhere. 

In  a  joint  and  unifled  method  of  operation  of  the  surface  and  rapid  transit  lines  such  as 

65 


is  contemplated  in  this  report  and  in  all  the  former  reports  of  this  Department,  certain  interests 
of  the  City  and  the  Philadelphia  Rapid  Transit  Company  must  he  considered  as  joint. 

The  Company  and  the  City  under  the  terms  of  the  ""  Contract  of  1907"  and  the  assumed 
terms  of  this  lease  are  virtuall.y  partners  in  a  city  transportation  enterprise  and  it  is  not  logical 
to  assume  that  an  advantage  can  accrue  to  one  [)artner  without  a  corresponding  advantage  to 
the  other,  according  to  such  terms  as  the  lease  shall  provide. 

It  has  been  assumed  in  all  discussions  that  the  Philadelphia  Rapid  Transit  Company  will 
have  prior  claims  upon  the  joint  earnings  of  the  lines  to  the  extent  of  at  least  receiving  its 
operating  expenses,  taxes  and  the  interest  on  its  investment  in  the  new  lines  and  their  equi]>- 
ment  and  such  amount  as  may  be  agreed  \ipon  as  a  recompense  for  diverted  business  in  merg- 
ing its  system  with  the  rapid  transit  lines.  Sueh  claims  should  also  include  any  agreed  tiuaneial 
damage  resulting  from  the  establishment  of  a  universal  transfer,  or  any  fai'e  changes  which  may 
be  authorized  in  the  "1907  Contract." 

The  City  will  receive  its  share  of  the  profits  only  after  the  allowances  to  the  Company,  as 
agreed  upon,  are  deducted. 

This  assumption  is  a  fundamental  feature  in  the  form  of  lease  proposed  luider  the  "Taylor 
Plans." 

It  will  be  seen  how  highly  imjiortant  it  is  to  operate  tiie  joint  or  merged  sj'stem  as  efficiently 
as  possible,  which  means  utilizing  the  existing  system  as  far  as  it  can  be  incorporated  into  the 
joint  operation,  and  it  should  I)e  self-evident  that  the  Cit.y's  assumed  liability  should  be  kept  as 
siiiall  as  po.ssible. 

Reservation  of  Space  in  Broad  Street  for  Through  Lines  of  the  Pennsylvania  Railroad. 

The  former  reports  of  this  Department  have  referred  to  the  proposed  occupancy  of  a  part 
of  the  space  under  Broad  Street  by  the  tracks  of  the  Pennsylvania  Railroad,  in  order  to  pro- 
vide them  with  facilities  for  through-routing  some  of  their  local  and  southern  trains. 

In  order  to  provide  for  the  joint  occupation  of  the  street  and  avoid  interference  the  reser- 
vation for  the  Pennsylvania  Railroad  has  been  placed  on  the  west  side  of  Broad  Street  and 
the  tracks  of  the  Broad  Street  Subway  placed  on  the  east  side. 

The  construction  of  both  the  systeiiLs  of  tracks  at  the  same  time  would  be  an  advantage 
both  to  the  City  and  to  the  Pennsylvania  Railroad  from  a  financial  standpoint,  and  a  great 
eonvenienee  from  the  standpoint  of  the  public  as  it  would  not  result  in  tearing  Broad  Street  up 
for  two  different  construction  periods. 

The  former  reports  have,  in  all  cases,  assumed  that  any  additional  expense  resulting  to  the 
City  because  of  this  joint  arrangement  will  eventually  be  paid  by  the  Pennsylvania  Railroad  and 
that  such  provision  will  be  inserted  in  any  franchise  granting  the  companj'  the  use  of  the  City's 
streets.  Up  to  the  present  time  these  plans  are  regarded  as  tentative  and  study  plans  only, 
worked  out  with  the  view  of  providing  for  what  it  is  believed  will  be  the  future  requirements 
of  its  system.  As  this  Department  is  in  hearty  symjiath}'  with  all  legitimate  plans  to  improve 
the  transportation  facilities  of  the  city  along  lines  which  seem  reasonable  and  progressive,  this 
Department  has  arranged  the  Broad  Street  Line  so  as  to  reserve  such  space  as  seems  reasonable. 

Change  of  City  Hall  Station. 

Tlic  alignment  of  the  two  tracks  continuing  down  Broad  Street  to  Spruce  Street  should, 
in  my  judgment,  be  modified  in  the  neighborhood  of  City  Hall  so  as  to  remove  the  station  from 

66 


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CITY  OF  PHILADELPHIA 
DEPARTMENT  OF  CITY  TRANSIT 


REVISED  LOCATION 

BROAD  STREET  SUBWAY 

CITY  HALL  STATION 


0       20      40       &OFU 


MARCH  1st,  1916 


MAP  NO.  6 


REVISED  LOCATION 

BROAD  STREET  SUBWAY 

CITY  HALL  STATION 


MARCH  1st.  1916 


MAP  NO.  6 


iiiKliriR-atli  City  Hall  and  place  the  same  on  a  diagonal  line  running  under  the  proposed 
I'laza  from  Broad  Street  Station  to  a  point  at  or  near  Arch  and  Broad  Streets,  thus  secur- 
ing a  greater  distance  between  the  City  Hall  Station  and  the  Chestnut-Walnut  Street  Station, 
which  for  the  present  will  form  the  southern  and  terminal  station  on  this  line.  This  station, 
and  also  the  Walnut  Street  Station,  will  become  2-track  stations  instead  of  4-traek  stations  as 
formerly  designed,  and  recommended  by  virtue  of  the  Parkway  Line  being  eventually  through- 
routed  to  North  Broad  Street  via  Sixteenth  Street  and  Walnut  Street.  This  will  greatly 
simplify  both  the  construction  and  operation  and  will  avoid  all  complicated  switching  arrange- 
ments needed  for  the  extreme  flexibility  of  operation  which  the  foriuer  "loop"  provided  in  the 
matter  of  right-hand  and  left-hand  train  operation  around  the  "loop"  in  addition  to  the  pro- 
visicm  tVir  through-routing  of  the  North  and  South  Broad  Street  Lines. 

The  location  of  the  City  Hall  Station  under  the  Plaza  just  north  of  the  City  Hall,  and 
diagonally  between  Broad  Street  Station  of  the  Pennsylvania  Railroad  and  Broad  and  Arch 
Streets,  will  permit  the  utilizing  of  Arch  Street  surface  ears  for  transfers  east  and  west  with 
much  greater  facility  than  the  present  recommended  location  and  will  relieve  the  pressure  and 
congestion  which  will  result  to  the  Market  Street  Subway. 

The  location  of  the  station  beneath  the  City  Hall  was  brought  about  as  a  result  of  limita- 
tions due  to  track  arrangement  and  three  fundamental  assumptions: 

1.  That  the  Philadelphia  Rapid  Transit  Company  will  either  presently  or  eventually  agree 
to  construct  at  their  expense  a  2-track  subway  east  and  west  vmder  City  Ilall,  thereby  operat- 
ing their  trains  on  a  tangent  as  a  substitiite  for  their  present  express  lines  circling  the  City 
Hall. 

2.  That  this  being  done,  the  iilatform  of  the  Fifteenth  Street  Station  will  be  extended 
eastwiird  sufficiently  to  permit  of  making  this  stalinu  the  main  transfer  ]ii)int  between  the 
imrth-aiul-south  and  east-and-west  lines.  These  items  have  been  estiniiited  to  cost  the  (!ompany 
at  least  $500,000. 

3.  That  it  is  essential  to  connect  the  Parkway  Line  into  this  station  in  order  to  include 
it  in  the  transferring  arrangements. with  the  Broad  Street  Lines  and  to  give  it  a  proper  ter- 


In  my  opinion,  it  will  be  a  fundamental  error  to  make  this  the  main  transfer  point  between 
the  east-and-west  and  north-and-south  lines,  since  at  this  point  both  lines  will  be  carrying  their 
maximum  load,  and  transferring  between  lines  should  be  done  at  point  of  less  congestion  and 
where  better  facilities  can  be  arranged  to  provide  for  it. 

Under  these  suggested  modifications  the  bulk  of  the  transferring  will  occur  at  two  points 
— Eighth  and  Market  Streets  and  Broad  and  Walnut  Streets.  At  l)oth  these  points  facili- 
ties can  be  provided  for  taking  care  of  such  transferring  as  may  be  desirable. 

A  line  should  be,  as  far  as  possible,  located  and  operated  so  that  it  will  take  the  people 
to  the  principal  points  in  the  business  district  as  directly  as  possible  without  the  use  of  transfers, 
and  I  believe  that  a  study  of  the  plans  herewith  sui)mitted  will  make  it  evident  that  transferr- 
ing will  be  no  more,  and  somewhat  less,  on  this  plan  than  on  the  plans  formeidy  proposed. 

This  matter  of  transfers  between  rapid  transit  lines  in  a  unified  sj'stem  is  a  vital  one,  and 
may  be  fairly  called  the  controlling  one  in  Philadelphia,  and  it  is  only  after  a  careful  study 
and  observation  of  this  situation  for  a  number  of  years  that  I  feel  warranted  in  suggesting  a 
change  of  this  character. 

67 


My  objections  to  the  present  location  of  line  and  station  are: 

1.  Its  extremely  high  cost. 

2.  It  is  not  the  proper  place  to  make  a  general  transfer  between  rapid  transit  lines. 

3.  The  station  is  too  close  to  the  Chestnut  Street  Station  on  the  south. 

4.  Liability  of  damage  to  the  City  Hall. 

5.  There  exists  no  agreement  with  the  Philadelphia  Rapid  Transit  Company  in  regard  to 
building  the  Market  Street  line  through  the  City  Hall  and  extending  the  Fifteenth  Street 
Station  platforms  as  contemplated. 

6.  Excessive  depth  required. 

7.  All  entrances  and  exits  of  the  stations  are  either  adjacent  to,  or  inside  the  City  Hall, 
necessitating  that  all  passengers  cross  the  inclosing  streets,  congested  with  traffic  of  all  kinds. 
Tliis  is  one  of  the  most  congested  points  in  the  city  and  this  station  would  increase  it  by  300 
per  cent,  or  more. 

The  reasons  in  favor  of  the  proposed  location  north  of  City  Hall  are: 

1.  Much  lower  cost  of  construction — fully  $500,000  less  than  the  present  plan. 

2.  Better  distribution  of  stations  on  the  line  by  increasing  the  distance  between  the  Race 
Street,  City  Hall  and  Chestnut- Walnut  Street  Stations.     (See  Map  No.  7.) 

3.  No  great  risk  of  damage  to  the  City  Hall,  at  least  much  less  than  by  the  other  plan. 

4.  Platforms  much  nearer  the  street  surface — about  7  feet. 

5.  Much  better  light  and  air  than  if  placed  underneath  a  building.  Station  will  not  be 
obstructed  with  heavy  wall  and  underpinning  columns. 

6.  Allows  the  utilization  of  the  Arch  Street  surface  line  to  relieve  the  Market  Street  Line. 

7.  Allows  for  such  amoiuit  of  transferring  as  may  be  deemed  necessary  to  provide  at  this 
station. 

8.  Permits  of  sub-surface  connections  under  streets,  making  less  congestion  on  surface  than 
otherwise. 

Change  of  Existing  Contract  for  City  Hall  Station. 

The  work  so  far  done  by  the  contractor  for  tlie  City  Hall  Station  consists  largely  of  pre- 
paratory and  iirelimiiuiry  work,  the  sinking  of  sumps  for  drainage  and  the  excavation  of  the 
material  down  to  approximately  the  level  of  the  City  Hall  foundations. 

No  masonry  or  permanent  work  on  the  station  has  been  placed,  and  the  excavated  material 
can  be  readily  replaced  out  of  the  new  work  and  the  City  Hall  restored  to  its  former  condition 
^vithout  great  delay  or  expense. 

Up  to  date  $79,775.47  has  been  paid  the  contractor  on  account  of  this  contract,  and  the 
final  figures  as  to  the  total  additional  amount  required  in  making  the  change  cannot  be  com- 
puted for  some  little  time. 

The  contract  under  which  this  work  is  being  done  provides  as  follows: 

"Changes. — Should   tlie  Director   change  the  design  of  any  portion  of  the  work  or  the 
requirements  of  the  specifications,  the  contractor  shall  conform  to  such  change.     If  such 

G8 


alteration  shall  increase  the  cost  of  the  work  to  the  contractor,  the  increase  will  be  added  to 
the  contract  price  to  be  paid  by  the  City,  and  if  the  cost  be  diminished  the  amount  of  such 
diminution  will  be  deducted  from  the  contract  price.  If  the  alteration  should  be  merely 
an  increase  or  decrease  in  quantities  of  structure  or  work  for  which  unit  prices  are  bid  and 
provided  in  the  contract,  the  contract  price  for  Item  1  will  be  increased  or  diminished  by 
the  difference  in  quantities  at  the  respective  unit  prices.  Should  the  change  involve  work 
or  material  of  a  class  for  which  the  contract  does  not  contain  a  price  the  increase  or  diminu- 
tion of  expense  will  be  estimated  by  the  Chief  Engineer  and  shall  be  subject  to  agreement 
between  the  Director  and  the  contractor  before  proceeding  with  the  changed  work,  or  at 
the  discretion  of  the  Director  the  work  may  be  required  to  be  done  under  the  force  account 
item  of  the  contract.  No  loss  of  prospective  profit  on  portions  of  work  cancelled  will  be 
estimated  to  the  contractor.  Any  change  to  be  made  at  an  increased  cost  may,  at  the  op- 
tion of  the  Director,  be  executed  under  a  separate  contract  therefor,  the  work  under  this 
contract  being  suspended,  if  necessary,  until  said  changes  are  completed.  The  contractor 
shall  give  every  facility  for  making  suclv  changes  and  will  not  be  allowed  compensation  for 
delay,  but  during  any  delay  that  may  result  the  charge  for  inspection  and  supervision  will 
be  suspended." 

Under  this  clause  the  Department  appears  to  have  full  authority  to  make  such  changes  as 
are  recommended  in  this  report  and  to  adjust  the  contract  on  a  fair  and  equitable  basis,  such 
adjustment  being,  of  course,  subject  to  the  approval  of  the  Mayor  and  the  City  Solicitor. 

If  the  approval  of  the  alteration  be  obtained  promptly,  work  can  start  vigorously  and  this 
contract  completed  ahead  of  the  remaining  section  of  the  Broad  Street  Line,  so  that  any  delay 
resulting  from  this  change  should  not  affect  the  date  of  opening  of  the  Broad  Street  Line. 


69 


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SlIDUld 


FINANCIAL  OPERATING  STATISTICS 


lu  the  1015  Report  of  this  Department  fifteen  sets  of-  slatcmeuts  are  gi\eu,  showing  the 
results  estimated  to  be  obtained  by  operating  the  different  lines  there  recommended  under  a 
lease  by  the  Philadelphia  Rapid  Transit  Company,  and  an  alternate  plan  assuming  the  lines 
leased  by  an  independent  operator.     The  assumed  forms  of  lease  are  there  stated. 

A  study  of  these  statements  shows  that  in  all  cases  the  City  will  have  to  shoulder  a  heavy 
annual  deficit  in  its  interest  and  sinking  fund  payments  over  a  long  period  of  years,  because 
the  City's  share  of  the  net  earnings  of  the  lines  will  be  far  short  of  the  amount  for  which  the 
City  mast  obligate  itself. 

For  the  latest  plan  (complete  system)  the  deficit  for  the  year  1921  is  estimated  to  be  over 
$2,000,000;  by  the  year  1930  the  total  of  the  ten  .years'  deficits  will  have  amounted  to  over 
.•t;20.000,000,  and  by  1910  to  over  ,+;50,000,000.      (See  Statement  G.) 

These  figures  assume  that  the  Camden  Tube  will  be  in  operation  by  the  Pliiladelphia  Rapid 
Transit  Company,  and  the  entire  net  earnings  of  the  Camden  Tube  have  been  applied  as  a  credit; 
otherwise  the  City's  deficits  would  I)e  considerably  larger.      (See  Statement  5  and  Diagram  No.  7.) 

In  order  to  make  a  just  and  proper  comparison  of  the  results  of  operation  of  the  lines  sug- 
gested herein,  with  the  above  results  of  operation  of  all  tlu^  lines  i-ecomniended  in  the  1915  re- 
port, the  same  terms  of  lease  are  assumed  to  apply,  and  the  calculations  show  a  deficit  in  1921- — 
the  maximum — of  $815,000,  reducing  year  by  year  as  traffic  increases  and  becoming  a  surplus 
or  profit  in  1931,  the  total  of  the  deficits  in  the  preceding  ten  years  amounting  to  $4,200,000. 

This  statement  shows  clearly  the  great  benefit  to  the  City  in  constructing  the  rapid  transit 
lines  in  successive  steps  and  operating  them  to  the  fullest  advantage  in  connection  with  the  sur- 
face lines. 

Assuming  that  all  the  money  necessary  for  the  construction  of  the  rapid  transit  system 
has  been  raised  either  by  the  former  plans  or  by  the  plan  recommended  in  this  report,  and 
the  system  constructed  is  ready  for  operation,  what  financial  results  from  this  operation  may 
be  expected? 

Results  in  comfort  and  convenience  are  well  understood  by  the  general  public,  and  need 
nut  be  discussed  here. 

During  the  past  throe  years  this  Department  has  estimated  the  operating  results  on  many 
different  combinations  of  lines,  and  many  different  methods  of  operation. 

The  following  statement  is  taken  from  the  1915  Report  of  this  Department,  and  shows  the 
situation  in  regard  to  operating  results: 


"ESTIMATED    FINANCIAL    RESULTS    OF    OPERATION    UNDER    VARIOUS    PLANS 

OP   CONSTRUCTION  AND   LEASE." 

"As  various  plans  of  construction  and  lease  have  been  discussed  and  developed,  estimates 
of  the  traffic,  service  and  financial  results  of  each  to  the  City  and  op(>ratiug  company  have  been 
prepared  in  complete  detail. 

"The  principal  of  the  various  plans  under  consideration  during  the  past  year  are  as  fol- 
lows: 


71 


Plan  No. 

1.  System  recommended. . .  P.  R.  T.  Co.  Operator Under  terms  of  Program. 

2.  System  recommended. .  .Independent  Operator No  transfers  with  P.  R.  T.  Co.  Frank- 

ford  not  connected  with  Market. 

3.  System  recommended ...  Independent  Operator. ..  .Transfers  with  P.  R.  T.  Co.     Under 

assumed  joint  rate  agreement. 
Frankford  not  connected  with  Mar- 
ket. 

4.  System  authorized P.  R.  T.  Co.  Operator Under  terms  of  Program. 

5.  System  authorized Independent  Operator. . .  .No  transfers  with  P.  R.  T.  Co.  Frank- 

ford  not  connected  with  Market. 

6.  System  authorized Independent  Operator. ..  .Transfers  with  P.  R.  T.  Co.     Under 

assumed  joint  rate  agreement. 
Frankford  through-routed  with 
Market. 

7.  System  authorized Independent  Operator. . .  .No  transfers  with  P.  R.  T.  Co.  Frank- 

ford through-routed  with  Market 
imder  assumed  rental. 

8.  Same  as  Plan  No.  4,  but  including  Delivery  Loop. 

9.  Same  as  Plan  No.  5,  but  including  Delivery  Loop. 

10.  Same  as  Plan  No.  6,  but  including  Delivery  Loop. 

11.  Same  as  Plan  No.  7,  but  including  Delivery  Loop. 

12.  Broad  Street  Line  as  authorized,  Independent  Operator.    No  transfer  with  P.  R.  T.  Co. 

13.  Same  as  Plan  No.  12,  but  including  Delivery  Loop. 

14.  System  authorized,  P.  R.  T.  Co.    Operator.    Under  modifications  of  Program. 

15.  Same  as  Plan  No.  14,  but  including  Delivery  Loop  and  Woodland  Avenue  Line. 

16.  Same  as  Plan  No.  15,  but  including  Northwest  Line. 

"Plans  Nos.  1,  2  and  3  embrace  the  system  recommended  by  the  Department  of  City 
Transit  in  its  Special  Report  to  Councils  on  February  11,  1915,  made  in  accordance  with  a  reso- 
lution of  Councils  on  February  4,  1915. 

"Plans  Nos.  4,  5,  6  and  7  refer  to  the  system  authorized  by  Councils  June  30,  1915,  under 
various  conditions  of  lease. 

"Plans  Nos.  8,  9,  10  and  11  embrace  the  system  as  authorized  by  Councils,  but  including 
the  Delivery  Loop.  These  plans  are  given  because  of  the  conviction  that  the  Delivery  Loop 
must  necessarily  be  built  as  a  part  of  the  Broad  Street  Line. 

"Plans  Nos.  12  and  13  give  the  estimated  results  for  the  Broad  Street  Line  alone. 

"The  estimates  embraced  in  Plans  Nos.  4  to  13  inclusive  were  used  in  the  application  to 
the  Public  Service  Commission  for  the  Certificate  of  Public  Convenience  required  under  the 
Public  Service  Company  Act. 

"In  all  the  above  plans  of  operation  by  tiie  Philadelphia  Rapid  Transit  Company  the 
terms  of  the  'Co-operative  Program  for  Rapid  Transit  Dovelopment  with  Universal  Free 
Transfers'  are  assumed  to  apply.  This  Program  was  published  in  full  in  the  Annual  Report 
of  the  Department  for  1914,  and  appears  on  Statement  No.  1  of  this  report. 

72 


I 


"In  the  plans  involving  operation  by  a  company  independent  of  the  Philadelphia  Rapid 
Transit  Company  it  is  assumed  that  tlie  operating  company  will  be  allowed  6  per  cent,  on 
its  investment  and  that  the  balance  of  the  net  income  would  be  divided  between  City  and  Com- 
pany in  proportion  to  their  relative  investments.  As  the  security  will  be  good,  the  Company 
could  probably  borrow  money  on  a  5  per  cent,  basis,  in  which  case  from  this  source  alone  it 
will  have  for  its  profit,  expenses,  hazard  and  operating  service,  an  amount  equal  to  1  per 
cent,  on  the  cost  of  equipment. 

"Plans  Nos.  14,  15  and  16  contemplate  operation  by  the  Philadelphia  Rapid  Transit  Com- 
pany under  a  modification  of  the  aforesaid  Program  as  discussed  in  a  previous  section  of  this 
report. 

"The  estimated  cost  of  construction  and  equipment  given  for  each  plan  includes  interest 
during  construction  and  the  necessary  real  estate  or  easements.  The  estimated  cost  of  equip- 
ment covers  that  equipment  required  at  the  beginning,  of  operation.  The  investment  in  equip- 
ment will  increase  from  year  to  year  as  required  by  the  growth  of  the  trafSc. 

"Since  the  preparation  of  the  estimates  of  cost  of  construction  a  contract  has  been  let  for 
the  City  Hall  Section  of  the  Broad  Street  Subway  at  a  price  fully  ten  per  cent,  under  the 
estimates,  and  for  a  large  part  of  the  Prankford  Elevated  Line  at  a  saving  of  about  twenty- 
three  per  cent.  Although  conditions  at  the  time  were  unusually  favorable  for  the  letting  of 
such  contracts,  it  is  believed  that  the  actual  cost  of  construction  throughout  will  be  less  than 
the  estimates." 

The  fact  that  it  was  necessary  to  estimate  so  many  different  ways  of  operating  and  making 
so  many  difi'erent  combinations  of  lines,  shows  how  hazy,  indefinite  and  uncertain  are  the 
financial  results  of  the  enterprise  upon  which  the  City  is  to  embark.  It  sliows  conclusively  that 
the  operating  results  cannot  be  ascertained  in  advance  of  certain  knowledge  as  to  terms  and 
conditions  of  the  lease,  and  by  whom  the  system  will  be  operated. 

Under  all  sixteen  of  the  plans  shown  there  results  a  deficit  from  operation.  The  size  of  this 
annual  deficit  and  the  period  of  years  over  which  it  continues  vary  with  the  different  assump- 
tions as  to  the  operator,  lines  involved,  and  terms  of  lease. 

It  is  not  necessary  in  this  report  to  go  into  the  details  of  these  sixteen  plans.  A  tabula- 
tion is  given  on  page  28,  showing  the  summary  of  results  on  three  different  assumptions  as  to 
operation,  but  all  providing  for  unified  operation. 

These  figures  present  the  only  argument  necessary  to  support  the  position  which  I  wish  to 
urge  as  one  of  the  features  of  this  report ;  namely,  that  the  operator  and  form  of  lease  should  be 
settled  as  promptly  as  possible  and  in  advance  of  any  large  amount  of  construction. 

I  am  satisfied  that  the  negotiation  of  this  lease  will  be  long  and  difficult,  for  while  the  City 
and  the  lessee  may  agree  on  the  fundamentals  it  will  be  hard  to  negotiate  a  lease  which  will 
be  satisfactory  from  a  business  standpoint  and  at  the  same  time  prove  satisfactory  to  City 
Councils,  on  account  of  the  pressure  which  may  be  brought  to  bear  on  representatives  of  local 
districts  in  Councils  for  extensions  which  connot  be  justified  and  which  the  lessee  cannot  as- 
sume. The  limit  to  which  the  City  can  go  in  developing  this  enterprise  is  the  loss  of  its  total 
bond  interest  and  sinking  fund  charges  and  although  the  lessee  may  agree  to  the  lines  author- 
ized at  the  time  of  the  lease,  protection  will  be  insisted  upon  which  will  limit  the  demand 
for  future  extensions  before  they  are  justified. 

Boston  early  recognized  the  true  function  of  rapid  transit  lines  in  a  unified  system  in 
supplementing  the  surface  car  service. 

Their  elevated  line  has  from  the  first  been  operated  between  one  transferring  terminal 
at  Sullivan  Square  in  Charlestown  and  one  at  Dudley  Street  on  the  opposite  side  of  the  city, 

73 


the  trains  being  through-routed  across  the  business  district.  At  each  terminal  large  transfer- 
ring accommodations  have  been  provided  and  the  transfer  between  systems  is  quick  and  con- 
venient. These  teriiiinals  are  but  43  miles  apart,  as  the  Boston  situation  permits  a  different 
focusing  of  surface  lines  from  that  of  Philadelpliia.  After  eight  years  of  operation  between  the 
original  terminals  the  territory  served  has  grown  sufficiently  to  warrant  the  extension  of  the 
i-apid  transit  line  from  CharlestowTi  on  the  north  end  to  Everett,  and  from  Dudley  Street 
on  the  south  end  to  Forest  Hills,  the  original  terminals  being  still  retained  in  service. 
Surely  fifteen  years  of  successful  operation  of  such  a  combination  ought  to  prove  its  adaptability 
to  similar  Philadelphia  conditions. 

The  Boston  development  ju.st  described  was  made  by  the  Company  in  order  to  satisfac- 
torily and  economically  meet  conditions  that  closely  resemble  those  above  Erie  Avenue. 

The  following  quotation  from  the  last  report  to  the  Board  of  Directors  of  the  Boston  Ele- 
vated Railway  Company,  referring  to  the  load  which  that  company  has  been  practically 
forced  to  assume  by  the  construction  of  rapid  transit  lines  in  the  city  of  Boston,  may  be  taken 
as  an  index  of  the  Company's  attitude  toward  such  lines: 

"If  any  stockholder  should  be  disposed  to  criticise  the  management  for  allowing  the 
Company  to  increase  its  capital  investment  so  rapidly  or  for  assuming  the  burdens  of  addi- 
tional subways  as  rapidly  as  it  has  done,  you  must  remember  that  what  has  been  assumed 
by  the  Company  is  only  a  small  part  of  what  has  been  demanded  by  the  public,  that  tre- 
mendous pressure  is  being  constantly  exerted  both  before  the  Legislature  and  the  other 
public  authorities  to  compel  the  Company  to  incur  additional  capital  expenditures  and  to 
assume  the  burden  of  additional  subways,  and  that  even  in  view  of  what  has  been  done 
people  who  are  interested  in  special  projects,  many  of  them  involving  large  expense,  con- 
demn the  Company  in  unmeasured  terms  for  its  refusal  to  assume  additional  obligations 
which  in  view  of  the  foregoing  it  ought  not  to  assume. 

"Your  Directors  are  firmly  convinced  that  it  is  absolutely  essential  that  in  the  near 
future  some  adequate  provision  should  be  made  for  a  substantial  increase  in  the  net  reve- 
nue of  the  Company.  In  their  judgment  no  adequate  relief  is  to  be  expected  either  from 
the  ordinary  increase  in  the  business,  in  a  reduction  of  operating  expenses  or  in  any  de- 
crease in  the  charges  ordinarily  incident  to  the  capital  investment." 

Tliere  is  this  difference  between  the  Boston  situation  and  the  situation  in  Philadelphia. 
The  Boston  lines  are  really  under-capitalized,  while  the  Philadelphia  Lines  are  over-capital- 
ized, making  the  Philadelphia  Lines  less  able  in  their  present  condition  to  carry  the  burdens 
which  these  lines  impose.  In  negotiating  this  lease  the  City  and  the  lessee  will  each  have  to  con- 
sider the  practical  limitations  involved,  and  each  must  try  to  recognize  that  his  standpoint  is 
not  the  only  one  from  which  this  undertaking  must  be  viewed. 

Up  to  this  time  there  has  been  no  suggestion  on  the  part  of  anyone  to  place  any  of  the 
burden  upon  the  ones  benefited,  namely,  the  riders.  All  propositions  and  suggestions  so  far 
submitted  indicate  that  fares  will  be  reduced  under  this  plan  of  lease  by  means  of  the  elimina- 
tion of  the  8-cent  exchanges,  and  the  suggestion  has  been  made  to  reimburse  the  Company  out 
of  proceeds  of  taxes.  This  is  only  another  means  of  transferring  the  burden  from  parties  bene- 
fited to  other  parties  for  no  reason  other  than  political.  It  is  not  sound  as  an  economic  measure. 
Sound  economics  dictate  that  for  a  period  of  years,  until  the  system  no  longer  requires  it,  the 
fare  per  journey  should  be  raised  sufficiently  to  provide  revenue  with  which  to  meet  the  City's 
charges.  The  exti'a  charge  may  be  readjusted  wlien  the  earnings  of  the  system  reach  a  point 
where  the  fare  can  be  reduced.  Such  increase  of  fare,  however,  is  only  suggested  as  a  temporary 
expedient. 

74 


FINANCIAL   CONSEQUENCES   OF  OPERATING   DEFICITS 


Probable  Effect  of  the  Transit  Program  on  City  Taxes. 

The  tables  accompanying  the  1915  Rei)()rt  showing  the  estimated  deficits  in  interest  and  sink- 
ing fnnd  charges  against  the  City  were  calcnlated  on  the  assnmption  that  the  proceeds  of  the 
one  mill  personal  property  tax  made  available  nnder  recent  legislation  will  be  nscd  wholly  to 
lighten  the  burden  of  these  fixed  charges  resulting  from  the  construction  of  the  City-built  rapid 
transit  lines.  Actually  this  extra  revenue  is  now  merged  into  the  City's  income,  and  as  the  law 
does  not  specifically  devote  it  to  rapid  transit  purposes  it  should  not  (in  stating  the  actual 
City  deficits)  be  considered  as  an  offset  to  the  deficit  in  the  fixed  charges.  The  comparative 
ligures  (see  Statements  5  and  (i)  do  not  include  this  tax  as  a  credit  to  the  operation  of  the  lines. 

It  seems  probable  now  that  the  deficit  shown  must  be  paid  annually  to  the  Sinking  Fund 
Commissioners  out  of  the  general  tax  revenues  of  the  City.  This  will  probably  necessitate  an 
increase  in  the  tax  rate  cm  real  estate  anumnting  to  4  or  5  cents  per  hundred  d<illars  if  the  Step 
Program  outlined  be  followed,  or  an  increase  of  10  to  15  cents  if  the  larger  i)lan  be  adopted. 

These  deficits  result  as  a  consecjuence  of  the  desire  of  the  City  that  its  residents  shall  enjoy 
better  transit  facilities  than  private  capital  seems  willing  to  provide  on  a  5-cent  fare  basis  with 
universal  free  transfers. 

How  are  these  Deficits  to  be  Met? 

The  preceding  artiele  and  Statement  2  .show  that  the  comi)reliensive  system,  if  built  and 
oi)erated  as  there  assumed,  will  probably  produce  a  drain  iii)on  the  City's  treasury  of  upwards 
of  $30,000,000  in  25  years. 

This  deficit  of  $30,000,000  in  fixed  charges  in  twenty-five  years,  averaging  over  $1,000,000 
per  year,  can  be  met  in  only  two  ways.  As  the  City  has  issued  the  construction  bonds  and  is 
therefore  liable  for  the  interest  and  sinking  fund,  any  deficit  will  probably  appear  eventually 
as  an  additional  tax  on  real  estate,  or  as  an  increase  in  ear  fares.  At  the  beginning  this  tax  may 
represent  an  increase  of  15  cents  per  $100  of  assessed  valuation,  and  will  probably  average  10 
cents  for  a  period  of  twenty-five  years. 

In  my  opiniou,  the  deficits  as  now  estimated  are  liable  to  be  larger  rather  than  smaller  than 
shown. 

The  annual  deficit  resulting  from  the  operation  of  Steps  Nos.  1  and  2  is  estimated  to  dis- 
appear in  about  ten  years,  and  the  accumulation  to  amount  to  a  total  of  approximately  $4,000,000, 
or  a  total  cost  to  the  City  by  the  year  1930  of  less  than  $36,000,000  as  compared  with 
$81,000,000  for  the  entire  plan  if  constructed  as  an  initial  system,  and  by  the  year  1940  the 
tUty's  accumulated  deficits  will  have  decreased  because  of  annual  profits  so  that  up  to  that 
time  the  City's  total  investment  will  be  less  than  $32,000,000  as  compared  with  $90,000,000  for 
the  entire  plan  if  constructed  initially.  As  the  maximum  estimated  annual  deficit  under  the 
suggested  plan  reaches  only  $815,000  and  averages  less  than  one-half  that  on  the  "Taylor  Plan" 
the  resulting  increase  of  the  tax  rate  should  not  exceed  5  cents  per  $100  for  a  pi'riod  of  ten 
years. 

The  deficits  for  the  entire  plan  constructed  as  an  initial  system  under  Plan  No.  1(5  of  the 
1915  Annual  Report  of  tliis  Department  are  based  on  the  assumption  that  the  (lamden  Tube  be 

75 


built  and  operated  by  the  Philadelphia  Rapid  Transit  Company.  The  entire  net  earnings  of  the 
Camden  Tube  are  applied  as  a  credit  against  any  preferential  payment  to  the  Philadelphia 
Rapid  Transit  Comjiany  on  account  of  net  income  diverted  from  the  surface  system  by  the  new 
high-speed  system.  If  this  tube  be  not  built,  or  the  net  earnings  not  so  applied,  the  de- 
ficits TO  THE  City  will  be  considerably  larger.     (See  Statement  5.) 

It  is  open  to  question  how  far  the  City  is  justified  in  using  money  raised  from  general  taxa- 
tion to  pay  deficits  resulting  from  the  operation  of  a  City-owned  rapid  transit  system. 

In  my  judgment  it  should  not  be  done  except  as  a  last  resort,  and  then  only  to  a  limited 
extent. 

The  alternative  is  a  higher  fare  for  the  improved  service. 

Who  Should  Carry  the  Burden  of  Deficits  Resulting  from  a  Unified  System? 

A  tax  on  real  estate  is  the  most  common  method  of  raising  numicipal  revenue,  as  real 
estate  is  the  most  tangible  property  upon  which  to  levy  taxes,  and  it  is  furthermore  supposed 
to  bear  more  equitably  upon  the  citizens  than  other  forms  of  taxation.  There  may  be  good 
grounds  for  questioning  the  justice  and  expediency  of  levying  such  a  tax  in  order  to  make  up 
deficits  in  the  City  Treasury  resulting  from  the  City's  participation  in  public  utilities  like  pas- 
senger railways. 

The  basis  for  proposing  such  a  tax  in  the  i>resent  case  probably  rests  upon  the  following 
assumptions : 

(a)  That  in  the  real  estate  tax  the  o^^•ner  will  carry  the  burden — not  the  tenant. 

(b)  That  a  5-ceut  fare  is  all  that  it  is  expedient  to  charge  the  car  rider  for  a  single  trip 
on  a  unified  transportation  system. 

(c)  That  any  increase  of  carfare  must  be  made  uniform  over  the  unified  system. 

(d)  That  a  imiform  increase  in  fare  would  directly  affect  the  entire  population  of  the 
city  while  an  increase  in  real  estate  taxes  would  directly  afi'ect  only  about  one-quarter  of  the 
inhabitants  of  the  city. 

(e)  That  an  indirect  tax  on  real  estate  to  meet  the  deficit  is  preferable  to  a  direct  per- 
sonal tax  in  the  shape  of  increased  fare. 

Considering  these  assumptions  in  the  order  given,  it  may  be  stated  that  the  assumption 
that  the  owner  of  the  real  estate  pays  the  taxes  will  be  recognized  as  a  fallacy  when  it  is  under- 
stood that  every  piece  of  property  is  occupied  by  a  tenant.  The  fact  that  the  o^vner  may 
be  the  tenant  does  not  alter  the  fact  that  he  is  a  tenant  nevertheless,  and  his  rent  consists  of 
the  sum  of  three  items,  (a)  interest  on  the  value  of  his  property,  (b)  taxes,  and  (c)  repairs  and 
maintenance.  Any  increase  in  taxes  on  the  property,  while  he  pays  it  as  an  o\^Tier,  he  also  pays  it 
as  a  tenant.  In  a  rented  property  the  increase  of  taxes  is  added  to  the  rent  wherever  pos- 
sible. "When,  owing  to  economic  conditions,  this  is  not  possible  it  is  reflected  in  a  fall  in  the 
value  of  the  real  estate  affected.  Since  with  this  explanation,  all  residents  of  the  city  are  ten- 
ants, it  is  readily  seen  that  it  is  largely  a  matter  of  expediency  whether  the  burden  be  dis- 
tributed as  an  indirect  tax  over  the  real  estate  of  the  City  or  by  a  direct  personal  tax  in  the 
shape  of  adjusted  carfare. 

The  assumption  that  a  5-cent  fare  is  all  that  it  is  expedient  to  charge  for  a  single  journey 
on  the  unified  system  would  give  the  impression  that  the  average  fare  on  the  present  system  is 
5  cents  only.    As  a  matter  of  fact  for  the  last  six  years  the  average  fare  per  journey  has  been 

76 


5.176^,  and  for  the  year  1915  was  5.166^,  this  increase  above  5  cents  being  occasioned  by  the 
additional  revenue  from  the  8-eent  exchange  tickets  (Statement  9).  I  have  observed  the  attitude 
of  the  public  in  the  last  two  years  on  this  question  of  fares  and  believe  that  the  opposition  of  the 
public  to  the  exchange  tickets,  and  the  demand  for  uniform  5-cent  fare,  result  more  from  the 
feeling  of  injustice  connected  with  the  situation  than  from  the  money  which  is  involved.  Statis- 
tics show  tliat  only  al)Out  6  per  cent,  of  the  riders  use  these  exchange  tickets  and  the  irritation 
which  they  create  is  out  of  all  proportion  to  the  number  of  people  affected.  It  is  the  injustice 
of  the  situation  by  which  free  transfers  are  available  at  certain  points  while  at  other  points, 
equally  or  more  deserving,  3  cents  additional  is  charged.  It  is  this  unjust  discrimination  which 
creates  the  irritation. 

In  the  unification  of  the  system,  for  which  the  lease  of  the  new  lines  should  provide,  tliis 
source  of  irritation  .should  be  eliminated. 

Elsewhere  in  this  report  the  question  of  adjustment  of  car  fares  has  been  discussed  and  Dia- 
gram No.  6  is  included  showing  that,  assuming  the  unified  system  be  in  operation  in  1921  as  per 
Plan  No.  16  of  the  1915  Annual  Report  of  this  Department,  the  increase  of  the  average  pas- 
senger fare  per  trip  to  about  5.59^  per  passenger  should  carry  all  charges  involved  in  a  de- 
velopment of  the  unified  system,  protect  the  existing  system  to  an  equitable  degree  as  outlined 
in  the  assumed  lease,  and  relieve  the  City  Treasury  from  any  drain — in  other  words  make  the 
unified  system  self-supporting. 

If  the  Frankford  Line  to  Bridge  Street  and  the  trunk  section  of  the  Broad  Street  Line 
(being  what  is  elsewhere  referred  to  as  Steps  Nos.  1  and  2  of  the  Comprehensive  System)  be 
constructed  and  in  operation  by  1920,  it  is  very  probable  that  the  increase  in  the  average  fare 
required  to  provide  for  the  City's  investment  will  be  very  much  less  than  if  the  comprehensive 
system  be  built. 

Depending  entirely  upon  the  terms  under  which  the  system  is  leased  the  average  fare  prob- 
ably required  will  be  about  5.30  cents. 

If  such  adjustment  be  made,  the  public  should  understand  in  advance  that  this  increase  is 
not  for  the  benefit  of  the  existing  Company  but  it  is  a  direct  tax  laid  upon  the  system  by  the 
City  in  accordance  with  the  terms  of  the  Contract  of  1907,  and  all  revenue  in  excess  of  the 
present  fare  .should  be  collected  by  the  Company  and  paid  directly  into  the  City  Treasury  as  a 
part  of  the  City's  income.  There  is  ample  precedent  for  this  method  of  financing  the  operat- 
ing deficits  as  a  similar  plan  has  been  in  use  for  many  years  in  Boston  in  connection  with  the 
East  Boston  Tunnel  under  Boston  Harbor.  In  this  ease  the  Boston  Elevated  Railroad  collects 
6  cents  per  passenger  per  trip  in  either  direction,  and  one  cent  of  this  is  paid  into 
the  City  Treasury  to  carry  the  interest  and  sinking  fund  charges  upon  the  cost  of  the  tunnel. 
It  is  identical  in  principle  with  what  the  City  is  now  doing  in  connection  with  its  own  gas 
works.  The  United  Gas  Improvement  Company  collects  from  the  customers  $1.00  per  thousand 
feet  of  gas,  turning  into  the  City  Treasury  quarterly  20  per  cent,  of  their  gross  collections  as 
rental  for  use  of  the  City's  plant. 

In  order  to  reach  the  average  fare  stated  above  (should  it  be  decided  that  an  increase  of 
the  average  fare  be  made  in  order  to  meet  these  deficits),  there  seems  to  be  no  logical  reason 
why  the  fare  should  be  uniform  as  between  the  two  systems.  The  fare  on  the  surface  system 
might  properly  be  left  at  5  cents,  and  the  fare  on  the  rapid  transit  lines  be  made  of  sufficient 
amount  so  that  the  average  fare  resulting  would  be  the  figure  necessary  to  carry  the  entire 
proposition.  This  method  would  have  the  further  advantage  of  requiring  the  lines  in  the  City's 
system  to  more  directly  earn  the  money  required  to  carry  the  new  investment  in  such  lines,  and 
it  would  further  have  the  advantage  of  placing  the  burden  upon  those  people  who  are  more 

6  77 


directly  benefited  and  who  are  able  to  avail  themselves  of  the  advantages  of  the  new  lines. 
Proper  arrangements  for  transferring  can  undunbtedly  be  devised,  and  elsewhere  a  tentative 
suggestion  for  such  arrangement  is  made  for  discussion  only.  In  all  cases  it  should  be  evident 
that  eventually  the  ultimate  consumer — in  this  case  the  citizen — must  pay  the  resulting  tax,  and 
he  alone  must  decide  in  which  shape  he  prefer.*  to  have  it  levied.  The  City  cannot  default  on 
its  interest. 

What  Adjustment  of  Carfare  Would  be  Necessary  to  Make  the  Unified  System  Self -Supporting? 

Attached  to  this  report  is  a  diagram  giving  the  average  fare  which  the  present  company  has 
collected  for  a  single  journey  since  the  year  1900,  and  this  diagram  has  been  projected  into  the 
future,  using  the  a,ssumed  income,  operating  expenses,  passengers  and  other  data  used  in  the 
estimation  of  the  result.s  shown  in  the  1915  Kepjrt  of  this  Department.      (See  Diagram  No.  6.) 

Assuming  that  the  comprehensive  system  recommended  in  the  1915  Report  had  been  in 
operation  in  1915  on  a  uniform  fare  with  universal  transfers,  all  as  contemplated  under  the  last 
suggestions  as  to  lease,  and  assuming  that  no  increase  of  passengers  would  have  resulted  from 
the  use  of  these  new  lines,  the  average  fare  necessary  to  produce  the  revenue  probably  would 
have  been  7.01^.  This  would  have  permitted  a  return  of  3  per  cent,  only  on  the  Philadelphia 
Rapid  Transit  Company  stock.  The  operating  expenses  were  assumed  at  70  per  cent.,  about 
the  same  as  those  of  Boston  for  the  same  year.  The  year  1915  being  a  year  of  low  earnings 
makes  the  operating  percentage  particulai'ly  high.     (See  Statement  10.) 

The  following  statements  show  what  fare  will  be  required  under  different  assumptions  to 
produce  sufficient  revenue  to  make  the  system  self-supporting,  and  the  diagram  attached  shows, 
on  the  basis  of  the  assumed  terms  of  the  lease  and  assumed  income  and  passengers  carried, 
what  fare  will  be  required  over  a  period  of  years  in  order  to  meet  the  requirements  of  the  uni- 
fied system.     (See  Statements  10,  11  and  12  and  Diagram  No.  6.) 

This  brings  out  some  of  the  difficulties  mentioned  earlier  in  the  report,  and  shows  how  it 
may  be  possible  to  readjust  the  fare  at  stated  intervals,  as  in  the  case  of  the  gas  lease,  or  at 
the  City's  option,  whenever  the  annual  surplus  earnings  reach  certain  amounts. 

These  are  matters  to  be  provided  for  in  any  lease  of  the  system,  and  show  one  of  the  many 
difficulties  for  which  provision  must  be  made  in  a  contract  running  over  a  50-year  period. 
This  also  clearly  shows  that  should  a  fare  adjustment  be  determined  upon  it  might  become  de- 
sirable to  introduce  some  form  of  ticket  system  such  as  "7  tickets  for  40  cents"  with  possibly 
an  adjustment  later  of  "9  tickets  for  50  cents." 

Diagram  No.  6  clearly  shows  that  before  the  expiration  of  the  lease  the  ideal  aimed  at  may 
be  realized  and  the  5-cent  fare  with  universal  transfers  on  the  unified  system  may  be  attained. 
To  accomplish  this,  however,  it  will  require  that  the  .system  be  extended  as  a  business  proposi- 
tion and  not  be  subject  to  unreasonable  sectional  demands  or  made  the  football  of  politics. 


78 


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86 


APPENDIX    A 


BUILDING   OF   RAPID   TRANSIT   LINES   IN   NEW   YORK   CITY   BY   ASSESSMENT 

UPON  PROPERTY  BENEFITED. 


(A  Memorandum  Addressed  to  the  Board  of  Estimate  and  Apportionment  and  The 
Public  Service  Commission  of  Neiu  York  City  hy  The  City  Club  of  New  York,  October 

2,  190  S.)  

"For  many  years  the  city  has  deemed  it  just  to  assess  upon  abutting  property  the  cost  of 
opening  streets  and  building  sewers.  The  theory  of  such  a  tax  upon  property  is  that  it  receives 
almost  the  exclusive  benefit  from  the  construction  of  a  street  or  sewer  adjacent  to  it.  The 
question  naturally  arises,  does  not  a  transit  line,  by  the  benefit  that  it  confers,  fall  in  the  same 
class  as  new  streets  and  sewers?  If  a  street  railroad  or  rapid  transit  line  be  extended  into  an 
undeveloped  territory,  is  it  not  built  primarily  for  the  purpose  of  furnishing  transit  facilities 
to  future  residents  in  that  section?  People  will  buy  this  property  primarily  because  it  has 
good  transit  facilities  and  the  value  placed  upon  it  is  largely  based  upon  its  accessibility.  This 

BEING  TRUE  AND  UNIVERSALLY  ADMITTED,  WHY  SHOULD  NOT  THE  PROPERTY  THUS  ENHANCED  IN 
VALUE  BY'  THE  EXTENSION  TO  IT  OP  A  TRANSIT  LINE  PAY'  FOR  THE  CONSTRUCTION  OF  SUCH  LINE,  TO 
THE    EXTENT    THAT    THE    INCREASED    VALUE    WARRANTS    IT,    INSTEAD    OP    RECEIVING    SUCH    INCREASED 

VALUE  AS  A  PRESENT  PROM  THE  CITY.  This  principle,  in  a  modified  and  unofficial  form,  is  oper- 
ated in  Berlin.  The  assessment  is  not  collected  by  the  city,  but  the  street  car  company  when 
extending  a  line  to  outlying  territory  requires  the  owners  of  the  property  benefited  to  guar- 
antee to  the  company  a  certain  return  upon  the  cost  of  such  extension. 

"To  throw  light  upon  the  above  question,  the  City  Club  has  been  making  some  painstak- 
ing investigations,  extending  over  several  months,  of  the  rise  in  value  of  land  along  the  present 
subway.  The  method  of  arriving  at  these  values  was  as  follows:  Assessment  values,  as  given 
by  the  Department  of  Taxes  and  Assessments,  were  taken  for  the  year  of  1900  on  vacant  lots  on 
a  basis  of  60  per  cent,  of  full  value  for  the  district  from  79th  Street  to  the  Spuyten  Duyvil ; 
65  per  cent,  between  Central  Park  and  Harlem  River,  and  60  per  cent,  in  the  Bronx.  These 
were  compared  with  the  assessment  values  of  1907  on  a  90  per  cent,  basis  for  all  these  districts, 
and  in  each  case  the  full  value  was  obtained  by  raising  the  assessment  figures  to  100  per  cent. 
In  the  districts  which  were  largely  built  up  all  vacant  lots  were  listed.  Where  there  were  few 
buildings,  as  in  the  extreme  northern  portion  of  Manhattan,  a  sufficient  number  of  such  lots 
were  taken  to  show  the  general  land  values,  and  from  these  was  figured  the  total  value  for  this 
district.  To  ascertain  the  proportion  of  the  increase  in  land  value  attributable  to  the  building 
of  the  subway,  it  was  necessary  to  deduct  from  the  total  rise  what  might  be  termed  a  normal 
rise,  or  the  increase  that  would  have  taken  place  through  the  natural  growth  of  the  city  with- 
out the  added  stimulus  of  a  new  transit  line.  The  only  basis  of  arriving  at  a  judgment  of  what 
such  a  normal  rise  probably  was  is  to  ascertain  the  rise  for  a  period  of  equal  length  under 
normal  conditions.  Accordingly  the  increase  in  value  of  the  same  land  during  the  preceding 
seven  years  from  1893  to  1900  was  determined.     It  was  found   that   values   rose   during  this 

87 


period  of  seven  years  on  an  average  of  about  50  per  cent,  in  tlie  district  on  the  west  side  below 
135tli  Street,  and  on  an  average  of  about  43  per  cent,  from  this  point  northward  to  the  Spuy- 
ten  Duyvil.  These  percentages,  then,  may  be  taken  in  these  districts  as  the  best  basis  ascertain- 
able for  a  judgment  as  to  the  normal  rise  for  a  period  of  this  length,  and  if  subtracted  from  the 
rise  which  took  place  along  the  subway  from  1000  to  1907,  should  indicate  the  effect  of  the 
subway  on  land  values  during  the  latter  period. 

"By  applying  this  method  it  was  discovered  that  the  land  from  79th  up  to  110th  Street  and 
between  Central  Park  and  North  River  had  increased  on  an  average  about  45  per  cent., 
which  is  about  the  expected  normal  rise.  In  the  district  along  the  Lenox  Avenue  line  south  of 
the  Harlem  River  the  average  increase  was  about  43  per  cent.,  which  would  indicate  that  land 
had  not  increased  in  value  due  to  'the  building  of  tie  subway.  The  explanation  of  this  un- 
expected condition  is  no  doubt  that  an  elevate!  road  already  existed  which  gave  fair  service 
to  these  districts,  so  that  the  additional  facilities  had  little  effect  on  land  value,  except  in  the 
immediate  vicinity  of  subway  stations. 

"The  rise  in  land  value  along  the  Broadway  branch  from  110th  to  129th  Street  was  much 
more  noticeable,  averaging  about  70  per  cent.,  but  the  locating  of  Columbia  University  at  this 
point  affected  values  to  an  extent  that  makes  it  quite  impossible  to  arrive  at  any  reliable  con- 
clu.sions  as  to  the  proportion  of  rise  that  should  be  attributed  to  the  subway. 

"The  situation  from  135th  Street  northward,  however,  is  entirely  different.  Between  135th 
Street,  155th  Street,  Convent  Avenue  and  North  River  the  land  increased  in  value  between 
1900  and  1907  about  $17,825,000.  Although  the  elevated  road  paralleled  this  district,  yet  ow- 
ing to  the  topography  the  road  was  of  little  service,  so  the  subway  added  very  materially  to  the 
transit  facilities  of  the  locality. 

"The  district  between  the  Harlem  and  North  Rivers  from  155th  to  178th  Street  increased 
in  value  about  $22,450,000;  from  178th  to  Dyckman  Street  the  increase  was  about  $15,925,000; 
from  Dyckman  Street  to  the  Spuyten  Duyvil  the  increase  was  about  $13,100,000.  The  aggre- 
gate rise  in  this  land  from  135th  Street  to  Spuyten  Duyvil  was  about  $69,300,000.  If  an  esti- 
mated normal  rise  of  $20,100,000,  based  upon  the  rise  of  the  previous  seven  years,  be  sub- 
tracted from  this,  it  leaves  a  rise  of  about  $49,200,000,  apparently  due  to  the  building  of  the 
subway,  which  is  104  per  cent,  increase  on  the  value  of  1900. 

"Tlie  rise  in  land  values  of  The  Bronx  is  likewise  very  noticeable.  Taking  a  district  along 
the  subway  extending  in  width  about  a  half  mile  on  either  side,  the  increase  in  land  values  was 
somewhat  as  follows :  From  the  Harlem  River  to  Willis  and  Third  Avenues  the  rise  was  about 
$9,200,000;  from  that  point  to  Prospect  Avenue,  about  .$22,100,000;  from  the  latter  point  to 
Bronx  Park,  about  $13,500,000.  The  aggregate  rise  in  land  values  for  this  district  from  the 
Harlem  River  to  the  Bronx  Park  was  about  $44,800,000.  Subtracting  from  this  an  aggregate 
normal  rise  of  $13,500,000,  it  leaves  an  increase  of  $31,300,000,  due  to  the  building  of  the  subway. 

"Since  this  property  has  been  so  enhanced  in  value  by  the  building  of  the  subway  by  the 
city,  could  it  not  have  contributed  largely  toward  the  expense  of  constructing  the  line  and  yet 
have  reaped  a  good  increase  in  addition  to  such  assessment  ?  As  previoiisly  stated,  the  aggre- 
gate rise  in  land  value  above  135th  Street  in  Manhattan  caused  by  the  subway  was  $49,200,000. 
The  cost  of  building  the  subway  from  this  point  to  230th  Street  was  $7,375,000,  or  but  15  per 
cent,  of  the  actual  rise  caused  by  the  new  line.  The  property  owners  could  have  paid  tlie  en- 
tire cost  of  this  portion  of  the  line  and  yet  have  had  a  net  profit  on  their  land  of  89  per  cent.,  or 
an  aggregate  of  $41,825,000  for  the  district. 

"In  The  Bronx  the  situation  was  in  most  respects  similar.  The  aggregate  increase  in 
land  value  (of  a  district  extending  about  a  half  mile  either  side  of  the  subway),  due  to  the 

38 


building  of  the  subway,  and  in  excess  of  a  normal  rise  of  $13,500,000,  was  about  $31,300,000. 
The  cost  of  the  line  from  143d  Street  to  Bronx  Park  was  about  $5,700,000.  Had  the  property 
which  was  benefited  borne  this  expense  through  the  form  of  an  assessment,  after  paying  such 
assessment,  there  would  have  remained  an  aggregate  profit  of  $25,600,000  in  excess  of  the  nor- 
mal rise  in  value  since  1900.  This  would  be  a  profit  of  77  per  cent,  on  that  property  caused 
by  the  increased  transit  facilities  of  the  subway. 

"It  will  be  noted  that  the  aggregate  rise  in  land  value  in  Manhattan  from  135th  Street  to 
the  Spuyten  Duyvil,  and  in  The  Bronx,  due  to  the  building  of  the  subway,  was  $80,500,000.  The 
cost  of  the  entire  subway  from  the  Battery  to  the  Spuyten  Duyvil  and  the  West  Farms  branch 
to  Bronx  Park  was  but  $43,000,000.  The  property  benefited,  in  the  districts  above  noted,  could 
have  paid  this  entire  cost,  and  yet  have  had  a  net  profit,  due  solely  to  its  construction  and  oper- 
ation, of  over  $37,500,000.  Had  it  paid  only  for  the  portion  running  through  its  own  territory, 
there  would  have  remained  a  profit  of  over  $67,425,000.  In  view  of  this  fact,  would  it  not  be 
reasonable  to  require  property  benefited  in  outlying  districts  to  pay  for  the  cost  of  a  rapid 
transit  line  built  to  serve  it? 

"The  data  gathered  from  the  influence  on  land  values  of  the  existing  subway  may  be 
applied  to  provisional  rapid  transit  lines.  Its  application  to  the  Fourth  Avenue  line  in  Brook- 
lyn, contracts  for  which  are  under  consideration,  would  indicate  that  the  land  along  this  pro- 
posed line  might  not  greatly  rise  in  value,  owing  to  the  fact  that  it  parallels,  at  a  distance  of 
one  block,  an  existing  rapid  transit  line.  This  assumption  is  based  upon  the  fact  that  the 
building  of  the  subway  affected  but  very  little  the  value  of  land  west  and  north  of  Central 
Park,  owing  to  the  proximity  of  an  elevated  road  which  gave  reasonably  good  service.  The 
possibilities  of  an  assessment  plan  may  be  best  brought  out  by  projecting  a  provisional  line 
through  territory  largely  unoccupied,  having  at  present  no  rapid  transit  facilities.  The  pro- 
posed extension  of  a  rapid  transit  line  through  Jerome  Avenue  in  The  Bronx,  if  built  as  a 
reinforced  concrete  elevated  structure,  in  order  to  make  it  noiseless,  could  be  constructed  for 
about  $2,550,000,  and,  judging  by  the  effect  on  land  values  caused  by  the  existing  subway  in 
The  Bronx,  where  the  conditions  were  very  similar,  neither  territory  being  within  easy  reach  of 
a  rapid  transit  line,  such  a  new  line  would  increa.se  land  values  in  the  Jerome  Avenue  dis- 
trict fully  $41,550,000.  If  the  property  holders  were  to  pay  for  the  cost  of  this  new  line,  after 
having  paid  such  assessment,  they  would  still  have  a  profit  of  90  per  cent,  on  their  land  as 
valued  in  1907. 

"If,  on  the  completion  of  the  Blackwell's  Island  Bridge,  an  elevated  road  were  to  be  con- 
structed of  reinforced  concrete,  to  connect  with  it  and  to  extend  out  Jackson  Avenue  to  Flush- 
ing, with  a  branch  leaving  this  main  line  at  DeBevoise  Avenue,  and  following  that  avenue  to 
the  vicinity  of  Berrians  Island,  such  line  would  be  aljout  9  miles  long  and  woiild  cost  about 
$4,500,000.  It  would  serve  approximately  9  scjuare  miles  of  largely  unoccupied  territory,  the 
aggregate  value  of  which  at  present  is  not  less  than  $57,480,000.  On  the  basis  of  the  rise  in 
value  caused  by  the  subway  line  in  The  Bronx,  the  aggregate  rise  of  this  land  in  Queens  would 
be  $54,600,000.  In  other  words,  the  landholders  in  this  district  could  afford  to  pay  for  such 
new  rapid  transit  line  and  yet  enjoy  an  aggregate  profit  of  $50,100,000,  or  a  profit  of  87  per 
cent,  upon  the  present  value  of  their  land. 

"This  plan  would  largely  solve  the  problem  that  confronts  the  public  service  com- 
mission IN  attempting  to  decide  between  factions,  each  contending  for  a  line  in  its  par- 
ticular section.    The  sincerity  of  speculators  and  real  estate  venturers  would  quickly 

BE  tested  by  the  REQUIREMENT  THAT  THEIR  PETITIONS  BE  ACCOMPANIED  BY  AN  ASSURANCE  OF 
A  WILLINGNESS  TO  BE  ASSESSED  FOR  THE  COST  OF  THE  DESIRED  LINE. 

89 


"Since  territory  now  served  by  a  rapid  transit  line  does  not  greatly  rise  in  value  due  to 
an  additional  rapid  transit  line,  it  would  probably  be  unjust  to  assess  property  adjacent  to  a  new 
line  in  such  districts.  That  is,  a  subway  extending  from  the  lower  part  of  Manhattan  to  the 
Harlem  River,  or  extending  eastward  under  the  East  River  and  through  the  congested  portions 
of  Brooklyn  could  not  justly  be  assessed  wholly  upon  adjacent  property.    Such  portions  op  nevp 

SUBWAYS,   IP   BUILT   BY   THE   CITY,   WOULD   PROBABLY  HAVE  TO  BE  PAID  POR  WHOLLY  OR  IN  PART  AT 

LEAST  BY  GENERAL  TAXATION.  It  is  Very  evident  that  property  in  the  vicinity  of  a  rapid  transit 
line  does  not  benefit  equally;  unsettled  outlying  territories  would  benefit  most;  territory 
in  the  vicinity  of  express  stations  would  rise  in  value  more  than  that  adjacent  to  local  stations. 
There  are  many  conditioning  factors  to  be  considered  in  any  attempt  to  lay  an  assessment  upon 
property  for  the  building  of  rapid  transit  lines.  These  factors,  however,  are  approximately  as- 
certainable, and  any  judicious  commission  would  be  in  a  position  to  secure  the  facts  as  con- 
nected with  the  present  subway,  and,  through  them,  would  be  able  to  lay  an  equitable  assess- 
ment upon  land  according  to  the  prospective  benefit  that  it  would  secure.  The  legislative  ac- 
tion   CONPERRING    on    the    city    the    power    needed  to  carry  out  this  plan  and  providing  POR 

a  better  system  OF  assessment  and  land  condemnation  could,  no  doubt,  eashjY  be  passed." 


90 


APPENDIX    B 


PAYING  THE  BILLS  FOR  CITY  PLANNING. 


(Extracts  from  a  Paper  Presented  by  Nelson  P.  Lewis,  Chief  Engineer  of  the  Board 
of  Estimate  and.  Apportionment  of  New  York  City,  at  the  Fourth  National  Conference 
on  City  Planning,  held  in  Boston,  Massachusetts,  May  27  to  29,  1912.) 


"*  *  *  The  question  of  how  the  bills  are  to  be  paid  is  not  only  a  pertinent  but  a  necessary- 
one  and  cannot  be  avoided.  To  provide  for  a  city  of  one  hundred  thousand,  with  no  apparent 
reason  for  exceptional  growth,  an  ambitious  scheme  suited  to  a  metropolis  of  several  millions 
is  to  invite  disaster;  while  to  limit  the  plan  of  a  large  and  rapidly  growing  city  occupying  a 
strategic  position  to  one  suited  to  its  present  size  will  seriously  retard  its  future  orderly  develop- 
ment and  may  prevent  it  from  realizing  the  growth  and  importance  of  which  its  natural  ad- 
vantages appear  to  give  promise. 

"The  feeling  is  common  and  not  vmnatural  that  if  we  are  planning  more  for  the  future 
than  the  present,  coming  generations  which  will  reap  the  benefit  should  bear  the  greater  part 
of  the  burden.  It  seems  easy  to  pay  with  borrowed  money,  particularly  when  the  money  can 
be  borrowed  for  fifty  years,  or  the  span  of  two  generations.  The  habit  of  paying  in  this  way 
is  easily  acquired  and  is  broken  with  difficulty.  "When  anything  is  paid  for  with  money  bor- 
rowed for  a  period  longer  than  the  possible  or  even  probable  life  of  the  article  purchased,  the 
city's  credit  is  improperly  used.  A  corporation  which  pays  for  its  betterments  from  earnings 
is  on  a  sound  basis.  When  large  earnings  are  used  to  pay  excessive  dividends,  and  betterments 
and  renewals  are  paid  from  borrowed  money  representing  /Jidditional  obligations,  there  is 
danger.  "When  interest  on  existing  debt  is  paid  from  funds  raised  by  incurring  more  debt, 
disaster  is  imminent.  The  only  source  of  revenue  of  the  American  city  is  its  power  to  tax. 
Its  credit  is  due  to  this  same  power  plus  the  value  of  its  own  property.  The  larger  the  city's 
debt  which  has  been  incurred  for  projects  which  are  not  self-sustaining,  the  greater  will  be  the 
demands  upon  its  taxing  power  to  meet  interest  and  sinking  fund  charges  due  to  such  debt, 
and  the  less  will  be  its  ability  to  undertake  new  improvements  and  at  the  same  time  meet  the 
enormous  running  expense  of  the  modern  city.  It  might  not  be  a  forced  comparison  to  say 
that  the  ordinary  services  which  the  city  renders  to  the  public  through  its  administrative  de- 
partments, the  expenses  of  which  are  met  by  the  regular  tax  levy,  are  the  dividends  which  it 
pays  to  its  stockholders,  while  for  its  betterments  it  must  issue  bonds  or  levy  special  assessments. 
Every  bond  issue  requires  an  increase  in  the  tax  levy  for  a  term  of  years  in  order  to  meet  in- 
terest and  amortization  charges,  curtailing  by  just  so  much  the  amount  which  can  be  expended 
upon  municipal  housekeeping  expenses.  In  order  to  keep  the  tax  rate  within  reasonable  limits, 
expenses  which  should  properly  be  met  from  the  tax  levy  are  often  paid  with  borrowed  money. 
Is  not  the  city  which  adopts  this  policy  actually  doing  the  same  thing  as  the  business  corpo- 
ration which  incurs  additional  debt  in  order  to  pay  dividends?  *  *  * 

91 


"In  the  more  fundamental  work  of  city  planning,  wjiere  unoccupied  territory  is  being  de- 
veloped, the  property  will  not  have  been  assessed  for  improvements,  and  consequently  the  cost 
of  the  acquisition  and  construction  of  new  streets  can  properly  be  assessed  upon  the  adjoining 
property  according  to  benefit,  such  benefit  representing  the  entire  cost  in  the  case  of  local 
streets  and  a  portion  of  the  cost  in  the  ease  of  thoroughfares  of  metropolitan  importance.    One 

PRINCIPLE    SHOULD    BE    INVARIABLY    RECOGNIZED,    NAMELY,  WHERE   THERE  IS  LOCAL   BENEFIT   THERE 

SHOULD  BE  LOCAL  ASSESSMENT.  There  Can  be  no  improvement  which  has  been  intelligently 
planned  and  executed  which  will  not  result  in  some  local  benefit,  and  it  follows  that  there  should 
always  be  some  local  assessment.  No  improvement,  however  small  or  however  large,  will  be  of  equal 
benefit  to  the  entire  city,  and  to  distribute  the  burden  of  paying  for  it  over  the  whole  city  ac- 
cording to  taxable  values  is  unfair  in  that  it  is  not  placed  according  to  benefit.  The  owners 
of  property  in  the  immediate  vicinity  are  frequently  enriched  at  the  expense  of  those  whose 
holdings  are  entirely  outside  the  district  dii'ectly  affected. 

"Perhaps  this  statement  should  be  so  qualified  as  to  exclude  certain  great  improvements 
such  as  public  buildings,  bridges,  docks,  and  rapid  transit  lines,  and  yet  there  is  doubtless  a 
local  benefit  resulting  from  these.  It  may  be  urged  that  such  things  are  not  included  in  what 
is  commonly  called  city  planning.  If  so,  the  definition  of  city  planning  needs  revision,  for 
tliey  are  certainly  most  essential  parts  of  any  city  plan.  The  City  Club  of  New  York  several 
years  ago  showed  that  as  a  result  of  the  building  of  the  first  Rapid  Transit  Subway  in  New  York 
the  actual  land  values  in  those  portions  of  upper  Manhattan  and  The  Bronx  which  were  most 
directly  affected  were  witliin  seven  years  increased  $80,500,000  above  the  normal  increase  for 
that  period.  The  cost  of  that  part  of  the  subway  passing  through  the  districts  where  this  rise 
in  values  took  place  was  about  .$13,000,000,  while  the  cost  of  the  entire  subway  from  the  Bat- 
tery north  was  .$43,000,000.  It  is  quite  evident  that  if  the  $13,000,000  which  was  spent  up&n 
that  part  of  the  subwaj"^  traversing  the  district  so  notably  benefited  had  been  assessed  directly 
upon  the  property,  its  owners  would  still  have  netted  a  neat  profit  of  some  $67,500,000,  while 
had  the  cost  of  the  entire  subway  been  assessed  upon  the  same  limited  district,  the  net  profit 
to  the  land  owners  would  have  been  $37,500,000.  "Was  it  quite  fair  that  property  in  distant 
parts  of  the  city,  entirely  unaffected  by  this  great  project,  should  bear  the  same  proportion  of 
the  burden  as  that  which  was  so  conspicuously  advantaged?  It  is  true  that  this  improvement 
is  entirely  self-supporting,  interest  and  amortization  charges  being  provided  from  the  rental 
paid  by  the  operating  company;  but  the  local  benefit  w^as  so  clearly  est^vblished  that 

THE  RAPID  TRANSIT  LAW  WAS  SO  AMENDED  AS  TO  PERMIT  THE  ASSESSMENT  OP  ANY  P.VRT  OP  THE 
cost  of  future  subways.  many  new  SUBWAYS  ARE  NOW  BEING  PLANNED,  AND  SOME  ARE  BEING 
BUILT,  BUT  IT  IS  DOUBTFUL  IP  ANY  OF  THEM  WILL  BE  SELF-SUPPORTING  FOR  YEARS,  THE  ROUTE 
FURNISHING   THE   MOST  INTENSIVE   TRAFFIC    HAVING  BEEN  FOLLOWED  BY  THE  LINE  FIRST  BUILT.    *    *    * 

"It  needs  no  extended  argument  to  prove  the  equity  and  wisdom  of  local  assessment  wher- 
ever there  is  local  benefit.  That  it  has  been  done  to  such  a  limited  extent  in  the  past  is  no 
reason  why  it  should  not  be  more  generally  done  in  the  future.  That  certain  pi-operty  o^v^lers 
have  heretofore  be-n  treated  with  such  prodigal  liberality  is  no  good  reason  why  others  should 
fatten  through  a  continuation  of  an  irrational  and  essentially  unfair  policy.  To  the  degree  that 
the  assessment  plan  is  adopted,  to  that  same  degree  will  tlie  city  jilace  itself  upon  a  cash  rather 
than  upon  a  credit  basis.  It  may  be  urged  that  the  adoption  of  such  a  policy  would  discourage 
the  agitation  for  and  execution  of  many  desirable  city  planning  projects,  tliat  American  cities 
have  been  slow  to  appreciate  the  advantages  of  intelligent  city  planning,  and  now  that  there 
has  been  a  marked  awakening  it  would  he  unwise  to  suggest  the  adoption  of  a  policy  which  might 
dampen  this  new-born  enthusiasm.     A  desire  for  something  which  involves  no  direct  cost  is  not 

92 


a  sign  of  intelligent  interest.  "We  are  learning  that  the  improvement  of  our  cities  pays.  That 
is  a  hopefnl  sign.  If  we  have  simply  reached  the  stage  where  we  want  better  conditions  only 
if  someone  else  is  to  pay  the  bills,  the  hope  has  not  a  very  substantial  basis.  If  we  want  them 
badly  enough  to  pay  for  them  ourselves  in  proportion  to  the  benefit  we  feel  sure  will  follow,  we 
are  making-  real  progress.  *  *  * 

"While  a  few  cities  may  now  have  statutory  authority  to  carry  out  the  policy  which  is  out- 
lined in  the  above  paper,  most  of  them  lack  such  power.  The  following  is  suggested  as  an  act 
which,  with  sucli  modification  as  local  conditions  and  existing  laws  may  require,  would  accom- 
plish the  purpose : 

"In  all  cases  where  an  administrative  board  is  authorized  to  determine  that  an  improve- 
ment is  to  be  made,  the  said  board  shall  also  determine  what  proportion  of  the  cost  and  ex- 
pense of  the  said  improvement  shall  be  assesserl  upon  the  property  which  shall  be  deemed  to 
be  benefited  thereby  and  what  proportion  of  the  cost  and  expense  thereof  shall  be  borne  and 
paid  by  the  city. 

"The  said  board  may  also  determine  in  each  ca.se  how  much  of  the  cost  and  expense  of  an 
improvement  shall  be  asse.ssed  upon  a  restricted  area  of  peculiar  benefit  and  how  much,  if  any, 
shall  be  assessed  upon  a  larger  area  of  indirect  benefit.  The  said  board  may  also  determine 
whether  the  entire  assessment  shall  become  due  upon  confirmation  of  the  same,  or  whether  it 
may  be  paid  in  annual  installments,  and  it  shall  also  determine  the  number  of  such  annual  in- 
stallments in  which  such  assessments  may  be  paid  and  the  rate  of  interest  which  shall  be  charged 
upon  all  such  installments  from  the  date  of  the  confirmation  of  the  assessment  until  each  in- 
stallment shall  be  paid;  provided,  however,  that  the  number  of  installments  shall  not  exceed 

and  the  rate  of  interest  to  be  charged  upon  the  same  shall  be  not  less  than 
nor  more  than  per  cent,  per  annum. 

"The  word  'improvement'  as  used  in  this  section  (or  act)  shall  be  deemed  to  include  the 
acquisition  of  title  in  fee  or  easement  to  any  land  requii-ed  for  streets,  parks,  bridges,  tunnels, 
waterways,  drains,  sewers  or  buildings  required  for  any  public  purpose,  or  the  construction  of 
streets,  parks,  bridges,  tunnels,  waterways,  drains,  sewers  or  buildings,  or  any  other  improve- 
ment, the  carrying  out  of  which  in  whole  or  in  part  will  increase  the  value  of  the  property 
in  the  immediate  vicinity  of  such  improvement  or  within  a  district  including  the  same,  or  will 
promote  public  utility,  comfort,  health  or  adornment  for  the  entire  city  or  part  thereof. 

"The  general  principles  which  should,  in  the  writer's  opinion,  govern  the  distribution  of 
the  cost  of  city  improvements  may  be  briefly  summarized  as  follows : 

1.  "Where  there  is  local  benefit,  there  should  always  be  local  assessment. 

2.  The  entire  city  or  the  metropolitan  district  should  bear  no  part  of  the 

expense  unless  the  improvement  is  in  some  degree  of  metropolitan  import- 
ance and  benefit. 

3.  Assessments  should  not  be  confined  to  the  cost  of  acquiring  and  impi-oving 
streets,  but  should  extend  to  any  improvement  which  will  increase  the 
value  of  the  neighboring  property,  and  should  be  apportioned  as  nearly 
as  possible  according  to  the  probable  benefit. 

4.  A  M'orkable  policy  once  adopted  should  be  consistently  adhered  to. 

5.  The  determination  of  a  policy  and  its  application  to  each  case  should  be  ^ 
entrusted  to  a  board  composed  of  men  especially  qualified,  whose  terms 

of  office  should  so  overlap  as  to  insure  continuity  of  policy  and  purpose." 

7  93 


APPENDIX   C 


JMEMORANDUM  AS   TO   LEGAL  STATUS   OF   ASSESSMENT   FOR   RAPID   TRANSIT 

DEVELOPMENT  IN  PENNSYLVANIA. 

In  order  to  provide  a  -wholesome  control  over  the  demands  of  outlying  sections  that  unwar- 
ranted extensions  of  high-speed  lines  be  made  at  the  City's  expense,  this  report  has  suggested  in 
several  places  that  the  extensions  into  the  outlying  districts  should  be  finauced  either  directly  or 
indirectly  by  assessment  upon  the  property  benefited. 

Owing  to  the  urgency  of  the  situation,  this  suggestion  was  incorporated  into  the  report 
on  the  basis  of  an  informal  opinion  that  in  Pennsylvania  it  would  probably  require  the  enactment 
of  a  special  law  only. 

Since  this  report  lias  been  put  in  type,  however,  an  official  legal  opinion  of  the  City  Solicitor 
upon  the  points  involved  lias  been  received  and  is  inserted  in  this  report  as  Appendix  "C." 

In  view  of  this  opinion,  it  is  evident  that  it  will  be  difficult  for  the  City  to  adopt  such  a 
method,  and  it  will  probably  be  necessary  for  the  City  to  build  the  entire  lines  out  of  City  bonds, 
unless  the  districts  aft'ected  are  willing  to  submit  to  local  assessment  voluntarily,  as  has  been  the 
case  in  a  few  instances  in  other  cities. 

Department  of  Law 

OP   THE 

City  op  Philadelphia. 

rilARCH  30,  1916. 

Assessment  of  Benefits  upon  Propertij-Oioners,  etc. 

William  S.  Twining,  Esq^. 

Director,  Department  of  City  Transit, 
City  Hall,  Philadelphia. 
Dear  Sir  : — Replying  to  your  communication  of  the  15th  inst.,  as  to  whether  the  City  of  Phila- 
delphia is  enabled  to  assess  benefits  upon  the  property-owners  to  bear  the  burden  or  portion  of  the 
burden  of  the  construction  of  additional  transit  facilities,  three  distinct  questions  are  raised : — 
1.  Can  this  be  accomplished  under  the  present  status  of  the  law?  2.  Can  this  be  accomplished 
by  legislation  ?     Or,  3.    Would  it  require  constitutional  amendment  ? 

1.  There  is  no  general  statute  which  authorizes  the  City  of  Philadelphia,  or  municipalities 
generally,  to  assess  owners  for  local  benefits  conferred  upon  property.  Those  statutes  confer- 
ring the  right  to  assess  benefits  upon  the  municii)ality  do  not  include  contemplated  improvements 
of  this  kind. 

2.  Since  the  decision  of  Hammett  vs.  Philadelpliia.  65  Penna.  146  (1870),  it  is  a  well-settled 
[irinciple  of  the  law  that  the  Legislature  may  grant  to  municipalities  the  power  of  local  taxation 
for  local  benefits  upon  properties  benefited.  But  the  local  benefit  must  not  merely  be  incidental 
to  the  contemplated  improvement;  it  must  be  the  primary  object  of  it.  In  the  case  above  men- 
tioned, tlie  Court  used  the  following  language : 

"Local  assessments  can  only  be  constitutional- when  imposed  to  pay  for  local  improve- 
ments clearly  conferring  special  benefits  on  the  parties  assessed  and  to  the  extent  of  those 

<».5 


benefits.     They  cannot  be  so  imposed  when  the  improvement  is  either  expressed  or  appears 
to  be  for  general  public  benefit." 

In  the  case  of  Washington  Avenue,  69  Penna.  352,  an  Act  authorizing  the  Commissioners  to 
make  an  artificial  road  through  a  number  of  townships,  assessing  the  cost  upon  the  abutting  own- 
ers, was  held  to  be  unconstitutional,  the  Court  saying: 

"To  do  so  is  confiscation,  not  taxation ;  extortion,  not  assessment,  and  falls  within  the 
clearly  implied  restriction  in  the  bill  of  rights. ' ' 

It  is  further  held  by  the  courts  that  in  any  event  onlj'  the  owners  of  directly  abutting 
property  can  be  assessed,  and  these  are  assessable  for  purely  local  benefits  alone.  The  practical 
difficulty  encountered  in  attempting  to  apportion  and  assess  a  special  tax  on  properties  not  abut- 
ting on  the  improvement  would  be  nearly  or  quite  insurmountable.  Although  property  in  the 
vicinity  might  be  benefited,  the  imposition  of  such  a  tax  would  not  be  feasible,  even  if  permis- 
sible, and  for  that,  among  other  reasons,  this  could  not  be  done. 

In  the  case  of  Saw  Mill  Run  Bridge,  85  Penna.  163,  it  was  attempted  to  assess  property- 
owners  for  the  building  of  a  bridge.     The  opinion  of  the  Court  in  part  is  as  follows : 

"Saw  Mill  Run  crosses  a  public  highway  of  the  city.  The  bridge  over  it  was  built  in 
the  line  of  this  highway,  in  which  every  inhabitant  of  Pittsburgh  may  have  some  interest 
and  every  citizen  of  Allegheny  County  and  of  the  Commonwealth  is  entitled  to  assert  some 
right.  In  such  an  improvement  surely  no  citizen  can  have  exclusively  private  right  and  he 
can  scarcely  have  any  definable  private  interest.  The  bridge  was  constructed  to  serve  an  ap- 
parent and  essential  public  purpose,  and  to  impose  the  cost  of  it  on  idividuals  selected  out 
of  the  mass  of  the  community  on  any  conceivable  rule  that  viewers  could  adopt,  would  be  the 
placing  of  public  burdens  on  private  shoulders." 

Again,  in  the  ease  of  Gratius  Run,  31  Superior,  638,  in  construing  an  Act  which  authorized 
boroughs  or  cities  to  alter  the  course  of  any  channel,  creek,  etc.,  the  Court  held  that  it  did  not  con- 
fer on  the  city  power  to  levy  any  special  taxes  against  or  assess  any  benefits  upon  any  property 
not  abutting  upon  the  line  of  improvement.  In  New  York,  a  statute  having  the  present  pur- 
pose in  view  has  been  passed,  but  its  validity  has  not  been  judicially  established.  Wherever  the 
assessment  of  property-owners  for  benefits  conferred  has  been  sustained,  the  benefit  has  been  a 
direct  one  to  the  property  abutting  upon  the  highway  or  other  place  where  the  specific  improve- 
ment was  physically  located,  and  the  amount  could  be  actually  ascertained  by  the  measure  of  the 
advantage  to  the  particular  property  affected. 

3.  It  follows  from  the  foregoing  decisions,  which  might  be  multiplied  almost  indefinitely, 
not  only  in  this  State  but  elsewhere,  that  no  Act  of  the  Legislature  having  in  view  the  assess- 
ment of  benefits  upon  property  for  the  construction  of  transit  facilities,  or  the  assessment  in  any 
other  manner  of  all  or  a  part  of  their  cost  upon  individual  property-owners,  would  be  sustained 
as  constitutional.  It  also  follows  that  the  only  method  in  which  this  could  be  done  would  be 
by  the  slow  process  of  constitutional  amendment.  As  you  are  aware,  an  amendment  to  the  Con- 
stitution requires  to  be  proposed  at  one  session  of  the  Legislature,  acted  upon  affirmatively,  re- 
ferred to  a  second  session,  the  Legislature  meeting  biennially,  again  acted  upon  favorably,  and 
then  submitted  to  a  vote  of  the  people.  Tliis,  together  with  the  time  elapsing  for  the  passing  of 
the  necessary  statutory  legislation,  would  compel  an  interval  of  four  or  five  years  before  such  an 
amendment  could  become  effective.     Added  to  this  would  be  the  great  difficulty,  even  after  the 

96 


amendment  of  the  Constitution,  of  formulating  an  Act  of  Assembly  which  would  enable  a 
proper  division  to  be  made  between  that  part  of  the  cost  which  should  be  borne  by  the  public 
and  that  part  to  be  charged  against  property-owners,  and  dividing  the  latter  among  such  own- 
ers individually. 

I  think  these  considerations,  if  they  do  not  make  it  absolutely  impossible,  certainly  make  it 
impracticable,  to  resort  to  this  method  of  financing  the  contemplated  improvement,  and  that  in 
considering  the  available  means  for  so  doing  any  project  looking  to  the  assessment  of  benefits 
upon  the  owners  of  adjacent  or  other  property  may  best  be  eliminated. 

Yours  very  truly, 

(Signed)  JOHN  P.  CONNELLY, 

City  Solicitor. 


97 


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